Pension Possibilities: IRA Rollover? Buy an Annuity? Or Take the Payout?
Pension decisions aren't clear-cut, and they can have serious consequences for you and your family.
Take some clients of mine, for example. The husband, age 65, wanted the highest monthly payout he could get, so he chose a 100% single life option of $2,100 per month. With that type of payout, the payments would end when he died. The joint life option he could have chosen would have paid only $1,800 per month. But although the payments were lower, his wife would have received the same amount once he passed away (and keep her quality of life).
A year and a half later, he was diagnosed with terminal cancer.
If you're contemplating retirement, it's in your best interest to be proactive and research the different benefit payout scenarios available, only 2% of employees participate in a pension as of 2014 (compared to 28% in 1979). If you're one of the fortunate, you could receive a stable, consistent amount of income per month for your entire life as well as a spouse's.
