Pension, lump sum or a mixture of the two? We provide invaluable advice on which option makes most sense.
In other words, calculate the assumed growth of the lump sum as you have done, but then use a life annuity rate to calculate the monthly withdrawal. Usually this is more accurate, as it more closely matches the pension payout, since that is also a guaranteed life contract from an ...
So, unlike a 401(k) or 403(b), a pension is not your own account or fund. Your employer then invests your (and your co-workers') money with the agreement that when you retire, you will receive a predetermined amount in either a lump-sum payout or monthly installments, often for ...
The 25% tax-free pension commencement lump sum is almost ideally targeted to discharging a mortgage on retirement – this makes life easier for early retirees because keeping the mortgage on lets them use other savings to smooth the income, and paying off the mortgage with tax-free cash compens...