I worked in the Benefits Department at my company. We offered our employees the lump sum option; for married employees the monthly pension options were: 50% Joint & Survivor; 10 Year Certain; 75% Joint & Survivor; 100% Joint & Survivor. I am surprised that you have the single life option as a married employee -- this means that if you pre-decease your spouse, she receives none of the pension benefit.
This is one of the most important decisions because you cannot go back in a few years and change your mind. You mentioned if you and your spouse should pass shortly after retirement then the pension is not paid to anyone. This is the wrong mindset.
When thinking of your pension, you need to consider that you may be collecting a pension for 20 to 30 years depending on your age, health, etc. There are lots of factors to consider -- your age at time of retirement; other investments; whether or not your spouse has a pension or other assets; your tolerance for risk, if electing the lump sum option; you also need to be very honest about how you view money and handle money.
I had employees tell me that they will have no expenses when they retire because the house is paid for -- really, does the hot water heater last 30 years? will you be climbing a ladder at age 80? etc. In the last few years, the cost of food, housing and other everyday items has increased. My point is you need to carefully consider the options.
Also, you and your spouse will be collecting Social Security benefits -- when one person dies then there is only on Social Security benefit.
Does your pension have a cost-of-living benefit?
Did your employer offer a 401(k) benefit? If yes, you may want to reach out to the adminstrator of the 401(k) benefit because they may offer employees access to a financial planner at no cost to you. The financial planner does not receive commissions -- this was true with 401(k) administrator of our plan. You can check with your Benefits Department.
I would suggest that you consult with a certified financial planner to review your situation. Based on your questions, this will be money well spent so that you have sufficient funds to provide for your expenses now and in the future.
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