Everyone I know tries to time the lump sum perfectly with regard to interest rates and such. What is your strategy?
3 replies (most recent on top)
Yes, It has been discussed at length on another thread. Although actuarially equivalent, most people are happier diversifying with the annuity when they have a big nest egg built up already as that plenty of market exposure for a retiree.
That what I did in 2016, @cuvk. I took the 100% J-S Annuity after 28 years with Chevron. I’m getting a $3,534 check every month plus social security that started last year. My retirement savings in 401k and IRA are not being drawn down.
Taking the annuity instead of the lump sum. That way we have a guaranteed income, regardless of what the market does. Chances are, most people who have had a career with Chevron already have a lot in the stock market, no reason to take the lump sum and invest it, as that way it is all in the market. Taking the pension as an annuity is a great way to diversify further and know you will always have something coming in every month.