I received a limited time offer by my previous MegaCorp to buy out my pension. The offer seems quite low. I'm estimating that the value of the Lump Sum payment to be 60-70% of the value of my pension.
To avoid taxes, I'd have to accept as a rollover to my IRA.
Another option would be to basically start monthly payments 5 years early at 50. If I live a normal life span, the money I would get would be half of what I get if I take the pension at normal retirement age at 65. (The value is also much lower than I would get if I take my pension at 55.) AND I would have to pay taxes, but the amount would be small.
I see no need for money before normal retirement age and my old MegaCorp's pension and the company itself does seem very stable. I'm not really counting on my pension at all, but I thought it would be a bit of a safety net in case I live a long time.
In conclusion, it seems like I should turn down the buy out offer. Any other thoughts? Am I missing anything?
To avoid taxes, I'd have to accept as a rollover to my IRA.
Another option would be to basically start monthly payments 5 years early at 50. If I live a normal life span, the money I would get would be half of what I get if I take the pension at normal retirement age at 65. (The value is also much lower than I would get if I take my pension at 55.) AND I would have to pay taxes, but the amount would be small.
I see no need for money before normal retirement age and my old MegaCorp's pension and the company itself does seem very stable. I'm not really counting on my pension at all, but I thought it would be a bit of a safety net in case I live a long time.
In conclusion, it seems like I should turn down the buy out offer. Any other thoughts? Am I missing anything?