I have just received a lump sum offer for a vested pension with a former employer. I have not started this pension yet so the actual payment will increase by approximately 5% every year I delay.
I am solidly in the "one year more" group. I've been FI since 2003 but I continue to soldier on because I make a profane amount of money for doing next to nothing and having no stress. The cash inflow lets DW and I spend without concern on pricey vacations. My only problem is dragging her away from the grandkids.
Here are the specifics. I am only using the single life annuity figures because the company assumed that our spouse's age was the same as the employees' so the numbers given for joint annuities don't reflect my reality. They did say that the joint annuities shown are 97% actuarially accurate. The joint figures matched well with the single life annuity I checked.
I'd like to know if people agree with my conclusion.
Lump sum offer: $163,149.02
Current single annuity: $1,154.43/mo or 13,853.16/yr (non-COLA)
Going to an online SPIA site, it would cost $224,507 for the same income stream. The company offer is 72% of this amount.
Both DW and I have excellent health. Longevity in her family is uniformly very high whereas my family history is highly variable.
As much as I dislike annuities, it seems to be in my financial best interest to turn it down. Agree? Disagree? Why? Did I leave out any relevant information?
I am solidly in the "one year more" group. I've been FI since 2003 but I continue to soldier on because I make a profane amount of money for doing next to nothing and having no stress. The cash inflow lets DW and I spend without concern on pricey vacations. My only problem is dragging her away from the grandkids.
Here are the specifics. I am only using the single life annuity figures because the company assumed that our spouse's age was the same as the employees' so the numbers given for joint annuities don't reflect my reality. They did say that the joint annuities shown are 97% actuarially accurate. The joint figures matched well with the single life annuity I checked.
I'd like to know if people agree with my conclusion.
Lump sum offer: $163,149.02
Current single annuity: $1,154.43/mo or 13,853.16/yr (non-COLA)
Going to an online SPIA site, it would cost $224,507 for the same income stream. The company offer is 72% of this amount.
Both DW and I have excellent health. Longevity in her family is uniformly very high whereas my family history is highly variable.
As much as I dislike annuities, it seems to be in my financial best interest to turn it down. Agree? Disagree? Why? Did I leave out any relevant information?