Should I Take My Pension In Payments Or As Lump Sum?

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[ChristopherAbelman]

Mini-retirement changed my life. I'm no longer waiting for some retirement paradise when I'm 65. It helps to know how to fund the lifestyle. You know, making money while you sip that piña colada by the beach does help. I wouldn't have been able to do it otherwise.

[iceviking]

At least he didn’t bring up my career in left handed puppetry again. For some reason he’s always putting me down.

[BrunoLuke]

The collapse of Margin debt leads to a decrease in stock prices and trigger a wave of selling as investors try to cover their losses, Buying a stock is easy, but buying the right stock without a time-tested strategy is incredibly hard. Hence what are the best stocks to buy now or put on a watchlist? I’ve been trying to grow my portfolio of $145K for sometime now, my major challenge is not knowing the best entry and exit strategies ... I would greatly appreciate any suggestions

[davek]

Every situation is different but in general, it's usually better to take the monthly payments. It wasn't that long ago that there was no such thing as a lump sum payment option attached to pensions. Why do you think that changed? It was because companies did the math and figured out that they would come out ahead if they paid out in lump sums. Think about that.

[youngtimer]

I retired 5 years ago and have already drawn more than the lump sum offer. No regret as I expect to live another 20. Also, my children are doing well and don’t need the inheritance.

[thatoneguyis]

I can't believe he didn't ask the big question first, like what does it pay? I know for my pension the lump sum is only my contributions, I lose all employer contributions, just don't think this is good blanket advice at all.

[mbpark]

Dave is wrong in some cases. Ur pension doesn’t necessarily die with u. U can leave the payments to ur spouse but it will die with ur spouse.

[speccollector]

for $147k, I would never take the lump sum. She can spend that in a couple of years. Usually agree with Ramsey but not on this one.

[jamgarza]

Most Americans today need that monthly pension payout to live on they can’t afford to tie it up in anything.

[Keyiente]

I just found Dave Ramsey & at 26 years old, I feel a little late but; I’m starting my journey on the plan today.

[thomasreedy]

1.) Was the CPA suggesting a physical Realestate investment or Riet?

2.)There is a very good chance your 401k plan will force you to roll over to an IRA if you take money out.

3.) As long as your money is in a 401k you have NO power over it. Companies may switch 401k providers and force you out of the market right after a dip, preventing your money from recovering with a typical quick upward correlation - mine did. It's taken me the majority of the year to recover from the 2018 end of year slump because of it :-(

4.) 401k plans charge pointless fees. Fidelity has zero maintenance fees on their IRAs.

IRAs before 401ks. Max out both if you can. Roll over 401ks to IRA when you can.

[alex]

Should have asked how much the income was for the pension. Hard to match pension income when you take lump sum, especially when pensions provide Increased distributions every year as a COLA (cost of living adjustment)

[velayuthman]

Recently, I read about pension crashes in the news. The impact on me worries me because I rely on pensions and need fund diversification ideas for my 400K assets.I know it's a good idea to have backup retirement income sources, such as investments but how do i allocate properly?

[jeff]

Depends on what age you begin to draw on that pension. In the example of peace officer hired at a certain period of time they can start drawing their pensions at 50 years and they COLA increases as well. If you live until 75 the amount you've drawn from the pension is much more than what they offer as a payout.

[jamesvelvet]

Completely stunned that he didn't even ask what the benefit payment would be on the pension. That is one of the most critical numbers you need to know for even a ballpark analysis. Weird. If I pull my pension as a lump sum I get a whopping I don't touch it and get $2, 600/mo benefit. Would be hard (nearly impossible) to match that return on such a small amount of principle.

[ricemonkey]

Dave Ramsey works for the corporations. Lump sums only make sense if you have another income to rely on and you want to set aside assets for your dependents. If you plan on living 8+ years, it's better to take the monthly payments. I'd like to see whether this person actually took his advice. Probably losing right now.

[ransom]

6-7% is a great return in retirement. Dave is out to lunch on 10-12%. Please get some additional financial advice Lorrie.

[quietsignal]

I took monthly annuity for life, no lump sum. Not married. It’s been 10 years, I have received 3 times what I had withheld for the pension. I’m 65.

[FiveMusic]

Each situation is different. Not taking the lump sum has assured income to me and my wife for our lifetimes. There are other assets that will become our children’s inheritance. By the way, my pension is a defined contribution type, so save the “free money” flaming... this is my money saved over several decades of work. The amount I receive versus market returns on a like amount invested in a positively performing market is comparable, and locked in by an exceptionally well funded and managed system. I’m not disparaging Dave’s advice, only interjecting that there are many types of pensions and individual situations, and you should consider all options carefully.

[joycecastona]

He's right. I own a duplex, paid in full. They do constantly need something. I spent over $10, 000 in updates this year and am looking at $3, 600 in spring minimum. They need new windows, furnaces, water heaters, etc.... Did that. A roof is $ 12, 000 easy. Think before you pull the trigger. If you slum it, well, you have no write offs and the property will lose value when you go to sell it. Also, if you don't update it, your competitors out there will attract better tenants than you.