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Old 10-02-2019, 07:05 PM   #21
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^^^^ I suspect that you are right but was trying to stay out of the weeds...
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Old 10-02-2019, 09:59 PM   #22
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A rollover to an IRA could be used for a QLAC deferred annuity within the IRA. The buy-in amount doesn't count when calculating RMD's, and you can defer monthly (taxable) payouts until age 85. Didn't seem like they were priced any better than regular immediate annuities, but might be a useful planning device for some.
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Old 10-03-2019, 07:31 AM   #23
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Lump sum for that amount. I wish my plan would offer a buy out. That’d be like $900k according to immediateannuity.
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Old 10-03-2019, 09:05 AM   #24
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Originally Posted by Perryinva View Post
Lump sum for that amount. I wish my plan would offer a buy out. That’d be like $900k according to immediateannuity.
You could always sell your pension benefits to J.G.Wentworth or Peachtree Financial.
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Old 10-03-2019, 09:30 AM   #25
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I had the same offer (for a bit more $$) and chose the rollover to an IRA. This way:
1) My monthly benefit can be chosen to start when I decide to
2) It will be inflation adjusted annually
3) It doesn't simply disappear when I die (it has listed beneficiaries),
4) I don't have to worry about the company running off with my investments, and if they do, hope that the PBGC doesn't reduce the monthly benefit as they have already done in some circumstances. (I don't think this is a one time and done occurrence)
5) I have many more investment opportunities with virtually no buy/sell delays. And I can track the gains/losses live online.

For this, I have a lower than possible monthly benefit for the first x years after which, it will be higher. In my case there was no question but to leave the company's plan and rollover to an IRA. It is a personal decision.
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Old 10-03-2019, 01:49 PM   #26
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I got one today, but a slightly different situation. It's a lump sum offer for DH's pension, which I started receiving when I was 50 (am now 53). It's a little over $10k a year, and they offered me $175k, which seems to be a terrible offer (seems like they made it as though I am older than 65).

I have no heirs, so don't really care about survivors losing out on it. And I have my own pension (from the same company) on tap when I turn 65.

I have looked at these two pensions, along with SS, starting with survivor benefits at 60 and my own at 70 as a nice safety net should my nest egg go south.

Am I thinking about it right? At the very least, I think I should wait and see if they ever sweeten the offer.
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Old 10-03-2019, 02:33 PM   #27
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I got one today, but a slightly different situation. It's a lump sum offer for DH's pension, which I started receiving when I was 50 (am now 53). It's a little over $10k a year, and they offered me $175k, which seems to be a terrible offer (seems like they made it as though I am older than 65).

I have no heirs, so don't really care about survivors losing out on it. And I have my own pension (from the same company) on tap when I turn 65.

I have looked at these two pensions, along with SS, starting with survivor benefits at 60 and my own at 70 as a nice safety net should my nest egg go south.

Am I thinking about it right? At the very least, I think I should wait and see if they ever sweeten the offer.
Using immediateannuities.com it looks like something closer to $200k would be more appropriate.

Given that it is a sub-par offer, and you do not have heirs to think about, I would probably stay with the pension.
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Old 10-03-2019, 08:32 PM   #28
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pretty sure you could take a check from the pension plan as long as you then deposit the funds in a qualified retirement account within 60-days. a direct rollover simplifies the process. i've done this in the past on several occasions when there was a fee to do a direct rollover.
Correct. I'm leaning towards the direct rollover, unless the fee is substantially more than I figure the convenience is worth.
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Old 10-19-2019, 03:38 PM   #29
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Since GE has frozen its retirement program, I have received an offer of 58K payout or $534/month starting when I turn 60 which is in 2022. If I can rollover the payout then I plan to take it. I'm not sure what the future has in store for GE but it's been a dog for the last number of years.
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Old 10-19-2019, 09:32 PM   #30
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^^^^ Seems to me like you are cutting off your nose to spite your face.... a $58k lump sum is pretty low for a $534/month pension.... but if you want to make a $50k contribution to the GE pension plan by accepting $58k for a pension worth $108k then by all means go ahead.
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Old 10-19-2019, 09:50 PM   #31
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Take the lump sum, invest it in a market index fund that tracks the dow until you are 62, when it will have grown to $45,000. Then draw your $283 a month and take it then. It will last you until age 88 at 6% interest in a market index fund and if you expire anywhere along the route, you leave it to heirs.
That is what I would do with a windfall I didn't have need of.
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Old 10-20-2019, 06:40 AM   #32
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I must be missing something here. Simple math tells me to do nothing here and wait until I'm 62 and take $283 a month.

($283 * 12) / $35,124.97 = 9.66% annual return
(191.92 * 12) / 35,124.97 = 6.55% annual return

If it take $35,124.97 cash and put into the market, will I get better than 9.66% guaranteed? I say no.

I'd do nothing and wait until 62 and take $283 a month myself. It's only 4 years away.
My second best option would be to take the $191.92 a month now.
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Old 10-20-2019, 07:41 AM   #33
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Originally Posted by pb4uski View Post
^^^^ Seems to me like you are cutting off your nose to spite your face.... a $58k lump sum is pretty low for a $534/month pension.... but if you want to make a $50k contribution to the GE pension plan by accepting $58k for a pension worth $108k then by all means go ahead.
Over 20 years at 4%, the 58K would be more than the pension would payout over that time. That's where my thinking came from.
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Old 10-20-2019, 08:41 AM   #34
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Originally Posted by mckittri2000 View Post
Since GE has frozen its retirement program, I have received an offer of 58K payout or $534/month starting when I turn 60 which is in 2022. If I can rollover the payout then I plan to take it. I'm not sure what the future has in store for GE but it's been a dog for the last number of years.
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Originally Posted by pb4uski View Post
^^^^ Seems to me like you are cutting off your nose to spite your face.... a $58k lump sum is pretty low for a $534/month pension.... but if you want to make a $50k contribution to the GE pension plan by accepting $58k for a pension worth $108k then by all means go ahead.
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Over 20 years at 4%, the 58K would be more than the pension would payout over that time. That's where my thinking came from.
Not sure the relevance of 20 years.... you said that you can take $58k now or $534/month starting in 3 years (2022)... according to immediateannuities.com a 57 yo male would need to pay a $108k premium today to get $534k a month for life starting in 3 years.

Your math is messed up.... the present value of $534/month for 20 years discounted at 4% is $88k.... IOW, if you put $88k in an interest bearing account paying 4% today and withdrew $534/month at the end of 20 years your money would be gone.

Or alternatively, if you put $58k in an interest bearing account paying 4% today and withdrew $534/month at the end of 11 1/4 years your money would be gone. You would have to earn 9.38% in order to get 20 years worth of $534/month withdrawals on a $58k deposit.

In short, it would be foolish to accept $58k in lieu of $534/month for life starting in 3 years unless you can earn 9.38% or more.
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Old 10-20-2019, 08:52 AM   #35
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Originally Posted by pb4uski View Post
Not sure the relevance of 20 years.... you said that you can take $58k now or $534/month starting in 3 years (2022)... according to immediateannuities.com a 57 yo male would need to pay a $108k premium today to get $534k a month for life starting in 3 years.

Your math is messed up.... the present value of $534/month for 20 years discounted at 4% is $88k.... IOW, if you put $88k in an interest bearing account paying 4% today and withdrew $534/month at the end of 20 years your money would be gone.

Or alternatively, if you put $58k in an interest bearing account paying 4% today and withdrew $534/month at the end of 11 1/4 years your money would be gone. You would have to earn 9.38% in order to get 20 years worth of $534/month withdrawals on a $58k deposit.

In short, it would be foolish to accept $58k in lieu of $534/month for life starting in 3 years unless you can earn 9.38% or more.
Thanks for the info.
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Old 10-20-2019, 01:47 PM   #36
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I feel like I’m way ahead of the retirement learning curve by reading these forums years before I plan to retire. Thanks for another educational thread everyone!
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Old 10-20-2019, 05:30 PM   #37
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Really good pension worth calculator: https://docs.google.com/spreadsheets...gid=2105382286
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Old 10-20-2019, 08:16 PM   #38
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Quote:
Originally Posted by mckittri2000 View Post
Since GE has frozen its retirement program, I have received an offer of 58K payout or $534/month starting when I turn 60 which is in 2022. If I can rollover the payout then I plan to take it. I'm not sure what the future has in store for GE but it's been a dog for the last number of years.
Thought that you might like this article. https://www.forbes.com/sites/baldwin.../#cc5a2f2691c1

Quote:
.... One 55-year-old who has publicly asked for comments on his deal is entitled to $737 a month beginning at age 60. Should he take that, he asks, or grab the cash?

He can use our calculator to size this up. The monthly income stream, we figure, has a present value of $151,000, assuming this guy is in good health and the pension plan doesn’t go bust. GE is offering him $75,000. ....
$75,000/$737*$534 =$54,341 ~ the $58k being offered to mckittri2000
$151,000/$737*$534 = $109,408 ~ the $108k value of a similar immediate annuity in post#30
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Slow and steady wins the race.

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Old 10-25-2019, 12:09 PM   #39
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I decided to take the lump sum & roll it into an existing IRA.
A 'direct' rollover wasn't an option, so sometime in early December, I'll receive a check for 35K made out to fidelity investments.

At that time, I'll mail it to Fidelity with the following.
Include a note with the check, informing us that the money is to be ‘directly’ rolled over into my existing IRA, the IRA account number, & a signature.

Thanks for all the replies.
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Old 12-01-2019, 07:35 PM   #40
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I received the check yesterday. This is probably a stupid question, but here it goes. Since the check is actually made out to Fidelity,
(although my name appears right below it) I assume that I don't endorse it on the back ?


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