Hi all,
I am voluntarily separating from my employer on 10/31/05. As a result of this I have the option to take my pension and roll it into my 401(k). On my company's website I read the following:
"This lump-sum amount is determined by taking your single life annuity benefit and converting it to a lump sum by using conversion factors based on mortality tables and interest rates obtained from the IRS. These interest rates are subject to change from time to time; the lump-sum benefit amount will increase or decrease as interest rates change."
Obviously I want the lump sum amount to be as high as possible. What would y'all advise in terms of when to initiate the rollover based on interest rates? ASAP? Wait a little?
Also, am I right in understanding that if interest rates rise, my lump sum declines? Or is it the reverse? (So since everyone thinks rates are going to continue rising through the fall, it seems like ASAP is the right answer.)
Finally, what would you do with this situation if you were in my shoes? Would you roll the pension into the 401(k)? Would you leave it alone? Personally I just want to simplify things (one less account to track) and get my money into my own account as opposed to leaving it in the pension pool (thinking about GM, here).
I can provide more info if necessary, just not sure what is relevant here.
malakito.
I am voluntarily separating from my employer on 10/31/05. As a result of this I have the option to take my pension and roll it into my 401(k). On my company's website I read the following:
"This lump-sum amount is determined by taking your single life annuity benefit and converting it to a lump sum by using conversion factors based on mortality tables and interest rates obtained from the IRS. These interest rates are subject to change from time to time; the lump-sum benefit amount will increase or decrease as interest rates change."
Obviously I want the lump sum amount to be as high as possible. What would y'all advise in terms of when to initiate the rollover based on interest rates? ASAP? Wait a little?
Also, am I right in understanding that if interest rates rise, my lump sum declines? Or is it the reverse? (So since everyone thinks rates are going to continue rising through the fall, it seems like ASAP is the right answer.)
Finally, what would you do with this situation if you were in my shoes? Would you roll the pension into the 401(k)? Would you leave it alone? Personally I just want to simplify things (one less account to track) and get my money into my own account as opposed to leaving it in the pension pool (thinking about GM, here).
I can provide more info if necessary, just not sure what is relevant here.
malakito.
