A pension is used as a tool for funding retirement where money is contributed while an employee is working and then received on a fixed basis when retired. While less commonly provided by companies today, pensions are seen as a safer investment than the 401(k), as you are not exposed to market risk and have a guaranteed payment for the rest of the individual’s life. Fiduciary retirement specialist Rob De Lessio of Strategic Wealth Designers joined us on the newscast to discuss pensions and the part that they play in retirement. See more financial news at

“A pension’s amount is dependent on years employed by the company and the final average salary of the recipient,” De Lessio says. “That is then multiplied by a percent that is offered by the company. On average, a two percent accrual rate is common amongst pensions. Some companies even provide pension benefits that are adjusted for inflation.”

Pension benefits are taxed differently based on the state that the money is being distributed. In Ohio, pensions and other retirement accounts are taxable on the Federal and State level. However, if the pension was accumulated in Ohio and the individual then moved to a state where pensions are exempt from income tax, they will not be subject to taxation on the distributions.

“The 401(k) and IRAs are great ways to accumulate money for your retirement,” De Lessio says. “However, as you prepare for the distribution phase, there are alternative ways to invest while still protecting your nest egg. For example, the indexed annuity is a great way to avoid downturns in the market while still participating in the upswing. It is important to speak with a professional on what options are right for your retirement goals and time horizon.”

Pensions often provide monthly lifetime income and are becoming an increasingly rare benefit offered to employees. To see additional stories surrounding business and economic news for the Cincinnati area, visit and if you have a question for Rob send an email to info@swdgroup.com….(read more)

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Retiring with a pension is a dream come true for many individuals. It is a traditional and reliable way of ensuring financial stability during the golden years. A pension is a retirement benefit that is determined by a formula based on an employee’s years of service, salary, and age at retirement. Most employers offer pension plans, which are a valuable asset for individuals looking to retire.

Pension plans have been around for a long time, and they provide a reliable source of income for retirees. A pension plan is a defined benefit plan, which means that an employee is promised a specific amount of income during their retirement years. This income is typically paid out monthly or annually and is based on a formula that takes into account the years of service, salary, and age at retirement.

One of the primary benefits of a pension plan is that it provides a guaranteed source of income. This means that a retiree can rest assured that they will have a steady stream of income for the rest of their life. Unlike other retirement plans like 401k’s, pensions are not subject to market fluctuations, so pensioners do not have to worry about their retirement income being impacted by market crashes.

Another benefit of a pension plan is that it allows retirees to maintain their standard of living during their retirement years. A pension provides a predictable income, meaning that retirees can budget their expenses accordingly. This can give them peace of mind knowing they have enough money to pay for their basic necessities, medical expenses, and other bills.

It is also worth noting that pension plans provide tax benefits to retirees. Since pension payments are considered income, they are typically subject to federal and state income taxes. However, some states do not tax pension income, so retirees can stretch their pension dollars further by living in a tax-friendly state.

Retiring with a pension does have some downsides, though. One of the main disadvantages is that pension plans are only offered by a limited number of employers. This means that not everyone has access to a pension plan, and those that do may not receive a significant amount of money if they have not worked for their employer for a considerable amount of time.

Another disadvantage is that pension benefits can be reduced or eliminated if the pension fund’s investment returns do not meet expectations. This can be a significant problem for retirees who were relying solely on their pensions to provide for their retirement.

In conclusion, retiring with a pension is a good option for individuals who want a reliable source of income during their retirement years. Pension plans provide a guaranteed income, tax benefits, and allow retirees to maintain their standard of living. While there are some downsides to pension plans, overall, they are a valuable asset for individuals who have access to them.