Understanding Pension Payout Options

If you, or someone you know have questions about which pension payout option may be the best, watch this video with Amy Shepard from Sensible Money.
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This presentation contains general information that is not suitable for everyone and was prepared for informational purposes only. Nothing contained herein should be construed as a solicitation to buy or sell any security or as an offer to provide investment advice.
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Any charts in the presentation are not meant to show the performance of SM strategies or to imply the performance of any model portfolios. Any charts or examples are meant to show the Firm’s belief in sticking to a plan over time, but there is no guarantee that you will have the same or positive results. Any results portrayed in these cases or examples are not representative of all of SM’s clients or the clients’ experiences.
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[@clevelog]

Thank you for the detailed and clear explanation. An important issue with lump sum payouts -as interest rates rise, the lump sum decreases. Lump sum projections made when interest rates were zero, are far larger than today.

[@sksjustice7693]

The social security offset. Is giving me over 20% more for 10 years. 55 to 65. I figured out that the cross over point. Was at age 75. After age 75 I am at a significant loss. However I have a decent amount of money in other retirement savings. Not touching those until 65. I also will not have the same expenses at 65. Mortgage, etc. A dollar today, is worth more than a dollar tomorrow. You can’t plan this stuff out. Like you are actually going to live into your nineties.

[@ianoldfield1488]

Very good explanation.
Very professional, clear and to the point. Thank you so much.

[@jc66ride]

Great description of the options Amy!

[@lindaripp5902]

Thanks

[@josephjuno9555]

Very good explanation! So .any Financial Planners (like Dave Ramsy) say Take Lum Sum! Next? I think Monthly Pension w 10% pay out gives me more secure future? I am Single and do worry about my Legacy? $233K LS vs $1840 p mo (not COLA) = around 10%?

[@dantheman6607]

I’m taking lump sum and investing it in stock and bonds mutual funds. I’ll control the money and my wife and kids will get the money when I pass.

[@kathy7602]

Nice explanation! If I choose 10 Year Certain and Life Annuity, it states: "Under this option, you receive monthly payments for your lifetime. Monthly payments will be made for at least a specified number of years as elected. If you die before the end of the selected period, your Beneficiary will receive the monthly payments for the remainder of the specified period." What if I outlive the 10 years? Do I still get something? Thank you!

[@Farmboy007]

Ten year certain will pay you until you die even if it is 30 years later. If you die before 10 years it will continue payment to your beneficiary until the 10 year mark.

[@ToniZ2010]

A QQ: if married, the beneficiary has to be spouse? Would it be child?

[@robertjohnson4912]

Yes, just a spouse. And, if your spouse passes before you-it can't be assigned to anyone else. So, if you take the monthly pension and a year later your spouse dies and then another year later you pass-all that money is gone. One good reason to take the lump sum.

[@anthonyrebock5351]

Because all these money managers are really about is ...eating your lunch

[@robertwilson7736]

Am 64 not a homeowner and will need housing benefit at 66 is it best to cash in now otherwise it will effect my benefit rights