Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Pension question
Old 08-17-2013, 07:48 AM   #1
Recycles dryer sheets
 
Join Date: Mar 2013
Posts: 104
Pension question

When I start taking my pension I will take the 100% joint and survivor option. Just checking my pension information and it looks like if I die before I start taking the pension my spouse will get the 50% joint and survivor option. The difference currently would be $13,000 per year less for my wife if I die before I start taking the pension.
I'm 59 and in good health. Is it worth the risk to keep waiting? The pension will grow by around 6% per year if I wait.
__________________

__________________
gbstack is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 08-17-2013, 10:59 AM   #2
Full time employment: Posting here.
 
Join Date: Jan 2008
Posts: 882
Quote:
Originally Posted by gbstack View Post
When I start taking my pension I will take the 100% joint and survivor option. Just checking my pension information and it looks like if I die before I start taking the pension my spouse will get the 50% joint and survivor option. The difference currently would be $13,000 per year less for my wife if I die before I start taking the pension.
I'm 59 and in good health. Is it worth the risk to keep waiting? The pension will grow by around 6% per year if I wait.
I think the answer depends on whether you have other assets/income sources that would protect your wife if you died before the pension started, as well as her expenses vs. the 50% survivor portion.
__________________

__________________
jebmke is offline   Reply With Quote
Old 08-17-2013, 11:03 AM   #3
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,461
Never thought of that situation. I would suggest that you check with your pension provider to confirm your understanding and see if there are any options you can elect now to increase her benefit.

The probability that you will die between 59 and 65 is low compared to the probability that you will survive to 65 or whatever age you pension maxes out so it you are an averages player you should wait. If you are risk averse you should consider starting it early.

I'm going to now have to go and check what my plan does in such situations.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
pb4uski is online now   Reply With Quote
Old 08-17-2013, 11:40 AM   #4
Full time employment: Posting here.
 
Join Date: Jul 2011
Posts: 576
My pension had a few more options. I took the 100% joint survivor benefit at 59 with a SS bump-up until 62. I can't remember the exact analysis but by doing it this way, I am ahead until about age 80 or 85 vs. taking the payout at 65. I do not remember if my pension had a 'penalty' if I should die first. I think the pension folks liked this as I expect they will have to pay out less in the end. However, it works with my income and cash flow. I am sharing this in case their is another approach to consider in your plan.
__________________
davef is offline   Reply With Quote
Old 08-17-2013, 03:42 PM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Sep 2005
Location: Northern IL
Posts: 18,288
You could buy term insurance to cover that time frame.

-ERD50
__________________
ERD50 is online now   Reply With Quote
Old 08-17-2013, 04:34 PM   #6
Recycles dryer sheets
 
Join Date: Mar 2013
Posts: 104
Thanks for all the information. It is greatly appreciated.
__________________

__________________
gbstack is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


 

 
All times are GMT -6. The time now is 08:54 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.