Chuckanut
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Defined benefit pensions are a thing of the past for many, but some of us still have one. I refused to give mine up when they offered us the option to switch to a defined benefit plan, despite some very big sweeteners.
Under the plan, assuming I retire next year, I could purchase an additional $4,800 per year of pension benefits for the rest of my life, at a one time cost of $66,000. The increased benefit is inflation indexed up to 3% a year. This is all defined benefit and the benefits are not subject to market conditions.
At first, I was skeptical since the $66,000 simply is gone from my asset base, but the inflation index has me thinking. I doubt if anybody is going to give me another chance to buy an inflation indexed retirement income (even partially indexed) in my life time. I have the money, though it would reduce my "the market goes to h**l and I don't want to sell this low" cushion from three to two years.
I would appreciate the thoughts of people familiar with these plans and anybody who has bought into one, or chosen not to.
Probable age at retirement: 62
No spouse, no need for a survivor benefit.
Under the plan, assuming I retire next year, I could purchase an additional $4,800 per year of pension benefits for the rest of my life, at a one time cost of $66,000. The increased benefit is inflation indexed up to 3% a year. This is all defined benefit and the benefits are not subject to market conditions.
At first, I was skeptical since the $66,000 simply is gone from my asset base, but the inflation index has me thinking. I doubt if anybody is going to give me another chance to buy an inflation indexed retirement income (even partially indexed) in my life time. I have the money, though it would reduce my "the market goes to h**l and I don't want to sell this low" cushion from three to two years.
I would appreciate the thoughts of people familiar with these plans and anybody who has bought into one, or chosen not to.
Probable age at retirement: 62
No spouse, no need for a survivor benefit.