Yup, another thread on this topic.
I've been running Firecalc for two cases of our pensions:
100% lump sum or 100% annuities. In both cases Firecalc gives us 100%.
These are estimates based on retirement in a few years.
Lump sum: $2.6M in tax deferred savings + $71K/yr SS income
Annuity plan: $1.45M tax deferred + $161K/yr from SS and pensions
All pension annuities are not COLA.
An investment advisor we know recommends going the annuity route. He argues that its good to have a steady cash flow that's not dependent on the market. Plus, your pension assets are protected from dumbass ideas like buying his and hers Porches and expensive condos!! We tend to be frugal so, I really am not worried about that.
On the other hand, annuities leave nothing to your estate. Once we both pass on, the annuities stop. With the lump sum approach, the pension assets go to our estate and our kids. We have 5 grown children and would like to leave something for them.
My wife considers this a deal-breaker for the annuity approach. I am not so sure, and go back and forth.
Any words of wisdom or real life stories?
Thx,
Rob
I've been running Firecalc for two cases of our pensions:
100% lump sum or 100% annuities. In both cases Firecalc gives us 100%.
These are estimates based on retirement in a few years.
Lump sum: $2.6M in tax deferred savings + $71K/yr SS income
Annuity plan: $1.45M tax deferred + $161K/yr from SS and pensions
All pension annuities are not COLA.
An investment advisor we know recommends going the annuity route. He argues that its good to have a steady cash flow that's not dependent on the market. Plus, your pension assets are protected from dumbass ideas like buying his and hers Porches and expensive condos!! We tend to be frugal so, I really am not worried about that.
On the other hand, annuities leave nothing to your estate. Once we both pass on, the annuities stop. With the lump sum approach, the pension assets go to our estate and our kids. We have 5 grown children and would like to leave something for them.
My wife considers this a deal-breaker for the annuity approach. I am not so sure, and go back and forth.
Any words of wisdom or real life stories?
Thx,
Rob
Last edited: