Just throwing it out there for convo : lump sum or annuity ?
21 replies (most recent on top)
It depends on your financial situation and age. If you have time on your side, it may be wise to take the lump sum, roll over into an IRA and invest in index funds. That's what I did...
@4fps : yes and yes
two slightly off topic but relevant questions - 1) Doesn't the lump sum amount ALWAYS start to steadily go down once you are older than 55?
2) Is it true that the annuity amount can only go up in value with more time in the company?
Thanks in advance to anybody that can shed light for us.
Using the lump sum amount, divide it by 12.
Do you think you’re going to live more years than the result?
Unfortunately, this does not take everything into consideration either as, having the money up front allowed for that monies growth
AND
once your dead, there still might be some principle left.
It’s a tough call.
As some one said earlier, consult a financial advisor who can add clarity to these what ifs.
For example, my co-worker’s financial advisor advised that, if you don’t think you’re gonna live past 81, it makes financial sense to take SS at the youngest allowable age, as you would not break even putting it off. If you’ve got good genes, wait to tap SS.
Advisors have tables for all these potential unknowns.
Good luck!
Peace.
Sold pensions are guaranteed to some extent as well by all the other insurance companies within your state, should the purchaser of your annuity go belly-up. There are protections for that possibilty. Check with the State.
Spending it all on lottery tickets.
It is a hard call and one I will face in a few years. At this point I will take a lump sum as I do not trust the company to not sell the pension. If you trust the company and have longevity in your genes then go for the annuity as in the long term it will pay more than the lump sum value.
Annuity with the pension money,
Investments with the 401k money.
It really depends on your own circumstances and whether you want to manage your own money or have someone else do it.
Talk to a financial planner. Not a layoff board.
Gonna be faced with this very soon . Thought I was gonna do lump sum but now leaning towards annuity
Don't ever take the word of someone who won't use their brain!
Why is it a no brainer ?
lump sum, that's a no brainer
Lump Annuity.
Private annuity contracts are not guaranteed by the FDIC, SIPC, or any other federal agency. If the insurance company that issues an annuity contract fails, no one in the federal government is obligated to protect the annuitant from financial loss. However, most states have guaranty associations that provide protection to citizens in that state if an insurance company also doing business in that state fails. All insurance companies in the state are required to pay into a fund to take care of policy holders should the company they’re counting on go under. It’s like an insurance policy for insurance companies. Check the limit of protection in your state.
Annuity (if you’ve got good genes or use the survivor option), with an accompanying term life insurance policy (if you have a wife / young kids) can be a good hedge that covers you and your loved ones well.
Annuity (if you’ve got good genes or use the survivor option), with an accompanying term life insurance policy (if you have a wife / young kids) can be a good hedge that covers you and your loved ones well.
Another factor to consider is the likelihood of Verizon selling the annuity obligation to another company like Prudential or similar. If they do, I don’t believe that there are any PBGC guarantees.
On the other hand if taking the lump sum it is a little daunting trusting someone to keep it safe enough to last.
The rule of thumb is the 4% rule, where it states that you can comfortably withdraw 4% of your lump sum annually. The annuity pays more than 4% but there the issue of trust that it will keep coming.
It is a decision I will have to make soon.
Annuity if you’re divorced, your parents live/lived to a ripe old age and you’re in similar health, or you wracked up OT/night tour differential in your last three years.
lump sum
I am gonna go annuity and supplement that with p/t job and 401k and ss .