[Rainger99]

Originally Posted by retiredguy123

lol. That is great if the wife knows what she is signing. My cousin was a military wife who signed the document, but didn't know that she wasn't a beneficiary until after her husband died.

Wow! Do you know if he intentionally cut her out or whether he made a mistake. I am going through my pension forms and they are pretty complicated!

[ton80]

In the Company I worked for, the wife was an integral part of the retirement meetings and signings. The HR folks prepared courses that explained everything to the best of their ability. On the wife agreeing to sign away her rights to the pension they made sure that she knew again to the best of their ability. Is it 100% GUARANTEED...NO, but it is an open discussion both in the courses and in the individual retirement signings. The courses and signings were done at the Company HQ not a local office.

[CoachKandSportsguy]

What an annuity is equivalent to is buying a bond with fixed monthly interest payments, with an unknown end point if it's for life. However, the for life actuary uses your life expectancy from actuarial tables, which is very generic.

my current life expectancy is
Northwest Mutual life span calculator is 91 years old after answering all questions accurately
Social Security calculation based upon birthdate only 84.6 years old

which life expectancy do you think the retirement company picked with the actuarial lump sum payout?

[Altavia]

Originally Posted by CoachKandSportsguy

What an annuity is equivalent to is buying a bond with fixed monthly interest payments, with an unknown end point if it's for life. However, the for life actuary uses your life expectancy from actuarial tables, which is very generic.

my current life expectancy is
Northwest Mutual life span calculator is 91 years old after answering all questions accurately
Social Security calculation based upon birthdate only 84.6 years old

which life expectancy do you think the retirement company picked with the actuarial lump sum payout?

Very key point for the OP.

[manaboutown]

I just did the NWML test and came up a life expectancy of 105. I had to laugh. I am now 82.

[Jim1mack]

Originally Posted by Rainger99

I have to make a decision on my pension.

I have the following options.

Please note that x changes below.

Single life annuity. I get x every month until I die.

10 year certain amount and life annuity. Pays out for my lifetime and fixed amount for 10 years. X here is about 94% of single live annuity.

50% joint and survivor annuity. I get x for my lifetime and wife gets .5x for her life. X here is 87% of single live annuity.

75% joint and survivor annuity. I get x for my lifetime and wife gets .75x for her life.
X is 81% of single live annuity.

100% joint and survivor annuity. I get x and my wife gets x for her life. X is 76% of single live annuity amount.

Lumpsum. A lumpsum payment. This would amount to 124 months of the single live annuity.

I am thinking the best choice is a lumpsum payment.

On all of the other choices (except for the 10 year certain amount and life annuity), if my wife and I die in a car crash a month after taking the pension, I am leaving a lot of money with the company. On the other hand, if we live 30 more years, we would do pretty well with the 100% joint and survivor annuity.

Any recommendations or suggestions? Thanks.

My finiancial advisor said, 'if only we knew how long you’re going to live'.

In our case it was my wife’s 401k that we bought a lump sum one. We were 60. If she dies monthly payments stop and I get what’s left. The longer she lives the less I would get should she pass before me. We are still healthy at age 72 and have watched the survivor (me) benefit dwindle. We should live to age 85 or beyond after which time there would be 0 survivor benefit. Should I survive her after age 85 and having to long-term care insurance I’m kind of screwed.

So we are looking at taking what’s left of the lump sum and adding it to our current brokerage account. After lengthy investigating I’ve determined that the dividends earned then would easily replace the Annunity benefit plus some while protecting the principal which could be used for long term care if need be. Of course stocks go up and down and dividend payouts can also fluctuate both up and down. I’ve seen it happen on the 10 stocks I bought 8 years ago just based on their yield. 10% or higher. Some 15%. They weren’t AAA rated stocks but I still receive dividends today between $700 and $900 monthly based on the quarter. That’s our ‘fun’ and travel money. I would keep those so theyd be in addition to the dividends we’d see should we proceed with this plan so kind of a hedge to down stocks and decreased dividends should that occur.

Haven’t ran this pass my advisor yet but will do next week to see what holes if any he shots into this ‘plan’.