Quote:
Originally Posted by valuemkt
First off - consider this.. Is this a pension, or a "structured settlement" ? Let;s assume this is a pension. Combined with social security, this is a guaranteed income flow.
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I agree with the above post, except the guaranteed income flow is only as good as the stability of the entity making the guarantee. Many pensions are very underfunded and are invested very heavily in equities and could become severely underfunded if the market crashes, which could ultimately kick the guarantee to the Pension Benefit Guarantee Corporation. The PBGC limits payouts to an amount that may be well below your expected pension payments. In addition, the PBGC is itself financially stressed and could be completely whipped out if the market crashes and multiple large pensions simultaneously fail to be able to meet their obligations. For this reason, it was a no brainier for me to take the lump sum and worry about making the necessary investment decisions myself. I would rather take the money and be in control rather than hoping that another party makes decisions that are in my best interest.