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View Poll Results: Portfolio or Pension ?
$2 million portfolio 33 41.77%
$80,000 yearly pension with COLA 32 40.51%
Not sure 14 17.72%
Voters: 79. You may not vote on this poll

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Old 10-23-2010, 08:44 PM   #21
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The vast majority of us won't have either choice so what's the point?
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Old 10-23-2010, 08:47 PM   #22
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I love the comments that any poll or simple question bring out.

Well, it all depends on the meaning of is...

Ha
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Old 10-23-2010, 09:07 PM   #23
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To me it is a no brainer - I chose the government option - for the peace of mind standpoint.

Let's assume you retire at 55 and estimate you will live 30 years to 85 - no health care, no social security, and you don't care about leaving any money at death.

Yes, I might be able to manage the $2M over that 30 years to match the government plan. But, I would probably have to spend much of the principle over that time to keep up with the gov't pension and I would have to assume risk.

Think of it this way with the gov't pension -
No risk of default
No market risk - stocks/bond
No bad investment risk (my stupidity)
No aging risk (meaning as I age I might not be able to manage the $)
No potential increase in taxes risk on capital gains, dividends, other stock/bond etc.
No inflation risk
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Old 10-23-2010, 09:18 PM   #24
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Does no healthcare mean no Medicare? If so then is anyone over 60 insurable?
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Old 10-23-2010, 09:18 PM   #25
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The vast majority of us won't have either choice so what's the point?
Maybe you won't have to choose between such a large pension and portfolio, but whatever amount of savings you can realistically think about accumulating, you will have a choice between keeping it as an investment portfolio, using the money to buy an annuity for lifetime income, or some combination of the two. Which looks best to you?
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Old 10-23-2010, 09:20 PM   #26
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Does no healthcare mean no Medicare? If so then is anyone over 60 insurable?

No health care does not include medicare . It means you are not getting health insurance as a perk .
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Old 10-23-2010, 09:25 PM   #27
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Since I am now 46 and ESRd at 43 I would take the $2mil. Our plan was always to build enough to quite early and a pension at 55 was not early enough. I'll just say the $2mil and our portfolio are similar numbers now. We also have Pensions awaiting us at 55 reduced or 62 Full and that combination is what we needed to pull the trigger. A hopefully sufficient portfolio and pensions is the combination we were blessed enough to end up with and it is what we worked towards.
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Old 10-23-2010, 09:56 PM   #28
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Since I am now 46 and ESRd at 43 I would take the $2mil. Our plan was always to build enough to quite early and a pension at 55 was not early enough. I'll just say the $2mil and our portfolio are similar numbers now. We also have Pensions awaiting us at 55 reduced or 62 Full and that combination is what we needed to pull the trigger. A hopefully sufficient portfolio and pensions is the combination we were blessed enough to end up with and it is what we worked towards.
i thought the question was: Right now, what ever your age, which would you rather have a 2 million dollar portfolio or an $80,000 pension that is paying right now, with cost of living adjustments but no health care ?

did i misunderstand?
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Old 10-23-2010, 11:03 PM   #29
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Portfolio. Not even close.
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Old 10-24-2010, 01:09 AM   #30
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Portfolio. Not even close.
Why the portfolio? I'm just curious.
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Old 10-24-2010, 01:17 AM   #31
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Another great point . I guess it has to be 100% survival to make it a reasonable choice . The reason I was wondering about this is because I have a pension and assets but during the melt down it was the security of the pension that let me sleep at night .
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Voted not sure.
It's too bad there is no 3rd choice: half and half, meaning $1M in the pocket and $40K/yr COLA'ed.
I am sure someone here has that half-n-half combination.
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Maybe you won't have to choose between such a large pension and portfolio, but whatever amount of savings you can realistically think about accumulating, you will have a choice between keeping it as an investment portfolio, using the money to buy an annuity for lifetime income, or some combination of the two. Which looks best to you?
In my younger years I would've taken the portfolio and immediately set out to beat Warren Buffett's record.

Now that I'm wiser older I'd take the portfolio and annuitize a portion of it.

Pretty much what's happening now...
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Old 10-24-2010, 07:20 AM   #32
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I chose the pension because my goal leans more toward the reliable/protected income need than "Pot-o-Money".

But I actually prefer a hybrid approach!

I intend to have my cake and eat it too!

Using SS, pension (no cola), and the nest egg...

Build a reliable base income stream and keep some of nest egg.

Why? Base income covered and flexibility to spend the excess money when I choose.
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Old 10-24-2010, 08:32 AM   #33
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Portfolio. They both work about the same during retirement but the pension has no value at the end. The portfolio would most likely be worth more than $2M in today's dollars when you are done with it. I'm happy with the risk, which is really not much with a diversified portfolio and the ability to reduce spending if necessary. Also, the pension has no flexibility for major expenses (new car, new roof, medical bills...) unless they occur later in retirement after you've been saving up.
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Old 10-24-2010, 08:40 AM   #34
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I am given to impetuous decision making, and this morning I would choose the $2 million dollars in the hand and immediately book several trips with that R. Crusoe travel mentioned in another post!
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Old 10-24-2010, 08:56 AM   #35
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To me it is a no brainer - I chose the government option - for the peace of mind standpoint.
To me it was a no brainer too and I chose the cash. I don't trust the federal government to follow through on their promises and they are the ones who determine the COLA rate and therefore it is subject to manipulation. I'll take the cash and the control thanks.
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Old 10-24-2010, 09:01 AM   #36
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I don't have a pension of any kind, but still a tough call so I voted not sure. There are advantages, disadvantages and risks with either - like life in general...
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Old 10-24-2010, 09:04 AM   #37
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To me it was a no brainer too and I chose the cash. I don't trust the federal government to follow through on their promises and they are the ones who determine the COLA rate and therefore it is subject to manipulation. I'll take the cash and the control thanks.
From the standpoint of control,I think the Government's control - tax, regulation - and public's willingness to demonize business is a greater threat to investors than pensioners.

The pensioners are people (and can vote) and are given automatic 'victim' status. While businesses (stocks/bonds) are automatically given 'evil' status so tax, regulate them.
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Old 10-24-2010, 09:06 AM   #38
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There are advantages, disadvantages and risks with either
Is there anything in life that you can think of that the above does not apply?
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Old 10-24-2010, 09:08 AM   #39
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Is there anything in life that you can think of that the above does not apply?
That's why the full sentence quote was "There are advantages, disadvantages and risks with either - like life in general..."
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Old 10-24-2010, 09:13 AM   #40
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A point I had not considered but if you take the 2 million and get divorced or sued you lose a lot of it but with the pension your money is safer .
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