We discuss a key retirement decision that retirees often face: choosing an annuity or a lump sum from their employer’s retirement plan. We learn about the factors that need to be considered when making that decision….(read more)
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Human nature should be the primary factor. 70% of lottery winners spend it all within 7 years. It is likely the same for people who take a lump sum and every one of the 70% always say that they will invest the money wisely and have money for the rest of their lives.
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Seems the tax hit would be too much with the lump sum. I'll probably just take out 5% or so each year. It's important to have funds in reserve, outside of pension, as well!
If you have a solid asset base taking the lump sum is the way to go.
The Socialist democrat party is looking to take 70% of the wealth you have gained in the form of TAX. Steal it from you and reward others for your hard work. NEVER vote Deomcrat
Good discussion! My company encouraged retirees to take the lump sum option for their defined benefit pension, and most people did without thinking about the risks and challenges of investing that lump sum. By comparison the monthly pension payout for this company (which was and is in good financial shape) was essentially risk-free. I looked into taking the lump sum and buying an annuity, it was only about 2/3's as much as the monthly amount from the company. The most common reason people gave me to take the lump sum is if they die young their children will inherit the pension benefit, they think they will get cheated if they die young.