Segment rates are going up, life expectancy has went down, and future funding is questionable. It's time to cut your losses, take the money and RUN! If you don't believe it, consult a proven financial planner.
10 replies (most recent on top)
Took my money and left the circus. No regrets.
No matter what, take the lump sum if you have retired or have left. I walked away with 167k. I was not going to trust xerox to manage it when I had 10 years to retirement. The day I gave my 2 weeks within that hour I called the benefits center. Kentucky call center. Easy to work with. They walked me through it. No hassle and the day after I walked out the door I had the check to give to my retirement guy. The poster who mentioned trust is spot on. Xerox lost my trust years ago.
Don’t need to compare the annuity to the lump sum. Take the cash. Do you trust anyone anymore? The reason people with a pension still work is because it’s a great option grow your investments for a few more years and pension payments are way less than salary. I’m over $200k and pension annuity would be around $75k.
Hello, who still gets a pension at this place? Not me. Heck, I got screwed out of my measly 401K match last year (and it is NOT a match, but, a fractional percentage that gets the match). How many years ago did we stop a pension program? And if you are still covered by a Pension why the heck would you still be working here?
Your "neighbor uncle's cousin's whos half-sister twice removed was in finance" is right on about that calculation. This is math not black magic - so if you know the inputs it is very simple. This calculate a lump sum easier https://financialmentor.com/calculator/present-value-of-annuity-calculator . If you go and get the 20 Treasury TIPs rate you can plug in results. This is a function of Interest Rates that are indeed going up - and what is used for life expectancy - and I think 20 years is what they use to determine.
This calculator helps with Present Value to estimate if lump vs monthly is better: https://valueyourpension.com/life-expectancy-present-value-calculator/
"No, my neighbor who's uncles cousin's sister was in finance told me so I will share it here."
Its a simple calc for lump sum. Present value of the earned annuity stream for 20 years. Interest is variable based on current rates. Available for 100% if funding is > 80% which it currently is. If you are retirement age and a few buck either way makes a difference, its too late for you anyway.
Hopefully y'all are consulting a certified financial planner instead of following the rants on this board. Fair to concerned but plan.
Life expectancy in the US went down by just over 2 years since 2019. I have no idea how much that impacts the lump sum value.
Life expectancy went UP, dummy! The fund is 90%+ funded