Are Pensions Paid Out For Life?

Shawn Plummer

CEO, The Annuity Expert

Types of Pension Payouts

Pensions can be structured in various ways regarding their payout duration:

  1. Lifetime Payouts: Some pensions provide payments for the lifetime of the retiree. Upon the retiree’s death, these payments typically cease, although some plans may offer continued benefits to a surviving spouse.
  2. Joint and Survivor Annuities: These are designed to cover two lifetimes, usually that of the retiree and their spouse. Payments continue until the death of the second person.
  3. Period-Certain Payouts: These pensions are paid over a fixed period, such as 10, 15, or 20 years. If the retiree dies before the end of the term, the remaining payments may go to their beneficiaries.

Comparing Life Payouts and Lump Sum Options

  1. Life Payout Through Pension: Offers a steady income for life but may have limited flexibility and could cease upon death, with no residual value for heirs.
  2. Lump Sum Rollover to IRA Annuity with GLWB:

Considerations for Choosing a Pension Payout Option

  • Financial Needs and Goals: Assess your financial needs, goals, and life expectancy.
  • Health and Family History: Consider personal and family health history.
  • Market Conditions: Understand the impact of market conditions on various options.
  • Tax Implications: Evaluate the tax consequences of each option.
  • Expert Advice: It’s advisable to consult with a financial advisor for personalized guidance.

Conclusion

Choosing the right pension payout option depends on individual circumstances, financial goals, and risk tolerance. Comparing lifetime payouts with options like a lump sum rollover to an IRA annuity with GLWB can help ensure financial stability and meet personal preferences. For a more detailed analysis and guidance tailored to your specific situation, contact us today for a free quote.

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Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed financial professional, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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