nun
Thinks s/he gets paid by the post
- Joined
- Feb 17, 2006
- Messages
- 4,872
Well I'm about to take almost a quarter of my tax deferred DC savings and buy into the the MA state pension plan. The numbers look good, but I'll expect a number of comments about the underfunding of state pensions.
I'm 53.5 and will be rolling $263k into the state DB plan which will give me an single life annual income of $19800 starting at 55, or I can take $19600 and have a beneficiary inherit the balance and interest of the pension if I die early. There's a COLA (currently capped at 3%) on $13500 of the pension. The initial payout rate is 7% and interest rate assuming I make it to age 84 is 7.5%.
I was a bit reluctant to "spend" so much on a DB plan just in case I died early as could not leave as much to my grand-niece, but the lump sum benefit is a nice option. If I die early she gets a big payout and if I live a long time the pension will have been a great investment/insurance policy. I intend to change my AA from 60/40 to something closer to 80/20 once the pension is bought.
What do you think?
I'm 53.5 and will be rolling $263k into the state DB plan which will give me an single life annual income of $19800 starting at 55, or I can take $19600 and have a beneficiary inherit the balance and interest of the pension if I die early. There's a COLA (currently capped at 3%) on $13500 of the pension. The initial payout rate is 7% and interest rate assuming I make it to age 84 is 7.5%.
I was a bit reluctant to "spend" so much on a DB plan just in case I died early as could not leave as much to my grand-niece, but the lump sum benefit is a nice option. If I die early she gets a big payout and if I live a long time the pension will have been a great investment/insurance policy. I intend to change my AA from 60/40 to something closer to 80/20 once the pension is bought.
What do you think?
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