Annuity Accuracy

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Needtoknow
Posts: 125
Joined: Sun Apr 01, 2012 11:19 am

Annuity Accuracy

Post by Needtoknow » Fri Jul 31, 2020 5:26 am

Hello,

I just want to make sure that this sounds correct. My job is giving a pension supplement. I can take a lump sum of $58,000 or take these options:

100% Annuity - $ 344
3 years certain - $1732
5 years certain - $1108
10 years certain - $ 647

The annuity is the same amount my wife would get if I were to die first. The others would continue to pay out to her until those years are completed.

These numbers don’t look accurate compared to the numbers I got from immediateannuities.com I put our ages 61 and 47 in and came out with very different numbers that were much lower. I was considering taking the lump sum and investing it, but then thought I could take that monthly amount and put it toward our monthly entertainment expenses. When I retire, I want no concerns at all.😀

tj
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Re: Annuity Accuracy

Post by tj » Fri Jul 31, 2020 9:36 am

Needtoknow wrote:
Fri Jul 31, 2020 5:26 am
Hello,

I just want to make sure that this sounds correct. My job is giving a pension supplement. I can take a lump sum of $58,000 or take these options:

100% Annuity - $ 344
3 years certain - $1732
5 years certain - $1108
10 years certain - $ 647

The annuity is the same amount my wife would get if I were to die first. The others would continue to pay out to her until those years are completed.

These numbers don’t look accurate compared to the numbers I got from immediateannuities.com I put our ages 61 and 47 in and came out with very different numbers that were much lower. I was considering taking the lump sum and investing it, but then thought I could take that monthly amount and put it toward our monthly entertainment expenses. When I retire, I want no concerns at all.😀
If what you say is correct, it sounds like the pension plan is not "penalizing" you as much for having a much younger wife.

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Stinky
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Re: Annuity Accuracy

Post by Stinky » Fri Jul 31, 2020 9:50 am

It may very well be that your pension plan is not reducing your monthly income very much for having a wife that is 14 years younger than you.

If you’re inclined to take the monthly income, that would be fine with me.
It's a GREAT day to be alive - Travis Tritt

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vineviz
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Re: Annuity Accuracy

Post by vineviz » Fri Jul 31, 2020 11:10 am

Stinky wrote:
Fri Jul 31, 2020 9:50 am
It may very well be that your pension plan is not reducing your monthly income very much for having a wife that is 14 years younger than you.

If you’re inclined to take the monthly income, that would be fine with me.
Me too.

Also, it's not uncommon for company plans to negotiate better payouts than comparable retail annuities.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

Topic Author
Needtoknow
Posts: 125
Joined: Sun Apr 01, 2012 11:19 am

Re: Annuity Accuracy

Post by Needtoknow » Fri Jul 31, 2020 4:33 pm

vineviz wrote:
Fri Jul 31, 2020 11:10 am
Stinky wrote:
Fri Jul 31, 2020 9:50 am
It may very well be that your pension plan is not reducing your monthly income very much for having a wife that is 14 years younger than you.

If you’re inclined to take the monthly income, that would be fine with me.
Me too.

Also, it's not uncommon for company plans to negotiate better payouts than comparable retail annuities.
It just seemed to be too good to be true, and you know what they say about that?😀

Topic Author
Needtoknow
Posts: 125
Joined: Sun Apr 01, 2012 11:19 am

Re: Annuity Accuracy

Post by Needtoknow » Fri Jul 31, 2020 4:44 pm

Stinky wrote:
Fri Jul 31, 2020 9:50 am
It may very well be that your pension plan is not reducing your monthly income very much for having a wife that is 14 years younger than you.

If you’re inclined to take the monthly income, that would be fine with me.
The difference just took me by surprise.

Make no mistake, she’s costing me a chunk.😀 $1300/month difference in the regular pension 100% joint survivor payout. We’ve been together 25 happy years. She’s the best investment I’ve ever made.

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David Jay
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Re: Annuity Accuracy

Post by David Jay » Fri Jul 31, 2020 4:50 pm

Needtoknow wrote:
Fri Jul 31, 2020 4:44 pm
We’ve been together 25 happy years.
How many years in total? :happy
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

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Stinky
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Location: Sweet Home Alabama

Re: Annuity Accuracy

Post by Stinky » Fri Jul 31, 2020 4:53 pm

David Jay wrote:
Fri Jul 31, 2020 4:50 pm
Needtoknow wrote:
Fri Jul 31, 2020 4:44 pm
We’ve been together 25 happy years.
How many years in total? :happy
Needtoknow - Pssst! We won’t tell anybody. Your secret is safe with us. :twisted:
It's a GREAT day to be alive - Travis Tritt

ralph124cf
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Re: Annuity Accuracy

Post by ralph124cf » Fri Jul 31, 2020 5:07 pm

The people who deliberately BUY SPIAs are a different population from the people who get them from a company. The people who go out and buy SPIAs tend to be longer lived and healthier, so the insurance company rationally charges them more.

Sounds like the lifetime joint annuity is the way to go.

Ralph

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