Rich_in_Tampa said:
Getting that pension enables you to avoid withdrawing said amount from your nestegg, leaving it there to compound away, no? More for the heirs, no?
I see your point. But let's take four people. A has a $40k pension, B has $1MM, C has a $40k pension and $1MM and D has $2MM.
Net worth according to this poll: A - $1MM, B - $1MM, C - $2MM, D - $2MM
So, according to this poll, A=B and C=D.
Inheritance/estate gifts left behind:
A - $0. Has to spend his $40k on living expenses.
B - $1MM. Spends the income, but leaves behind the principle plus on average enough to make it an inflation-adjusted million (since he's presumably making let's say 7% on average, spending 4% of that and re-investing the other 3%).
C - $1MM plus compounding of 7%.
D - $2MM. $1MM inflation-adjusted and $1MM plus compounding of 7%.
To me it's the difference between having a life estate or trust income versus owning/controlling it. The residual has value and in one case you control it and in another you don't.
Granted there all sorts of other issues to consider (security! guaranteed COLA! no bear market worries!), but for a "net worth" poll, the numbers aren't comparable IMHO.