1. Business & Finance
About.com
Money Over 55

Discuss in my forum

Pension Benefit Distribution Decisions - Important Choices To Make

Lump Sum Or Annuity? Single Or Joint Life? Decisions About Your Pension Benefits

By , About.com Guide

See More About:
If your company offers a pension plan, and you have been there long enough to be eligible for benefits, you will have one or two critical pension benefit distribution decisions to make when you retire. Below is a summary of each main choice, and links to detailed information to help you weigh out the pros and cons.

1. Lump Sum Or Annuity Pension Benefit Distribution

Some companies require you to take your pension plan in the form of an annuity payout; essentially monthly payments for your life. More and more companies, however, are giving you the option of taking your pension as a lump sum distribution instead of an annuity payout. You need to carefully weigh out the pros and cons before making this decision.

2. Single Life Or Joint Life Pension Benefit Distribution

If you choose a life-only payout on your pension plan it means when you die, the income stops. If you are married, and you both rely on this pension income, this may leave your spouse in a lousy financial situation. Your plan will offer numerous payout options to choose from, so be sure to study them and find the one that fits your joint financial needs.

©2012 About.com. All rights reserved.

A part of The New York Times Company.