How to Get the Most From Your Pension Or Retirement Plan

Pension Maximization
Getting the most out of your retirement will require a tough decision.

While planning for retirement dreams, you have 3 events that will happen upon retirement.

1)You will go from 100% paycheck to roughly 70% retirement income.
2)You have a touch decision to make. Will you share with our partner this retirement you have built up.
3)Your group insurance disappears. While employed, you often had health and LIFE insurance coverage through group plans. This now disappears and you are left to fend for yourself.

So what about all of those retirement dreams you have? The vacation home or cabin, your chance to travel health allowing, recreation and entertainment, but most of all the security of knowing that you will not outlive your retirement and that there will be enough to cover your lifestyle.

You have prepared for retirement in one of several ways: There is the automatic way: Pensions, Profit sharing, Government plans, 401k'sP.E.R.S.

Then there are the do it yourself plans: I.R.A., HR-10, Tax sheltered annuities, Life insurance, Deferred compensation.

You have accumulated a substantial amount of dollars.

There are basically 3 options (some have more variations, but you get the idea) Option one you get 100% of your pension. Upon your death the partner gets none. Option two you get 70% of your pension and upon your death the partner gets the same amount that you were receiving. Option three you get 85% or your pension while your partner gets 50% of what you were getting upon your death.

This could be a substantial difference should you live a long life. Assuming you have a 2,000 a month retirement and elect option two. Your monthly income is now 1,400 a month for the rest of your life. At twenty years, that is 144,000 difference.

These costs are for life even if the partner dies first.

Most people on the day they retire unknowingly purchase the largest death benefit ever. With no control. Letting your retirement guarantee your partners income all control is lost. You pay for your entire life, you receive less monthly income for the rest of your life, you can never change the beneficiary, and this can disinherit the children. You will also receive a lower cost of living since the amount you receive determines the increase each year. This is the costs that are never returnable.

The alternative calls for total control. You pay only for a limited number of years, you always receive the maximum monthly income, you can change beneficiary at any time. The children could become beneficiaries. Cost of living index is based on a larger amount. The alternative also allows for an emergency fund.

It comes down to this. The peace of mind of sharing your pension with your partner and the enjoyment of your maximum pension benefit.