Originally Posted by chinaco
Yes. You do not know all the OPs details.
Most of us do not either and were just offering comments and opinion as requested by the OP.
But it was a bit suspicious to me that he was being told to trade in pension with a cola for a variable annuity... where the goal of the variable annuity (for a retiree) is often to keep up with inflation.
The situation you are describing... (which did not seem to be the OP's main concern) did it ever occur to you that a term life policy might be an option to consider?
Good point on the term insurance, didn't consider that. Assuming he's insurable, it would probably be a good idea to weigh the cost of term insurance against the reduction in income if he were to take the PLOP and VA option. I still tend to favor the VA option since he could keep his money invested and have it grow since he will likely be retired for 30ish years.
I guess I was just a little surprised when I initially read the thread that everyone was piling on annuities like they have no place. I know they're expensive, and definitely not for everyone, but I think they can be utilized effectively in some scenarios, this being one of them. Everyone seemed to immediately dismiss the PLOP and annuity idea since annuity is a dirty word around here, but I felt like nobody considered the whole what happens to the PLOP money if I die scenario. It just makes sense to me to take a minimal reduction in income to protect the underlying asset, but obviously I'm in the minority.