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Should I Take My Pension As A Lump Sum?

Although increasingly rare, employer pensions can make up a considerable portion of your clients’ expected retirement benefits. Whether they are nearing retirement or are already receiving ongoing pension payments, clients may have the option to choose a lump sum distribution/buyout instead of a lifetime stream of payments. Several factors must be analyzed in order to determine what course is best for your client and their unique circumstances.

This flowchart helps you guide your clients as they consider their pension options. It covers:

  • Life expectancy considerations
  • Viability of pension plan
  • Risk tolerance and need for guaranteed income
  • Wealth transfer considerations
  • Lifetime income options

 

Updated for 12/15/2020