| Pension Math Story Problem |
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startingover
Member
Cash: $ 2.90
Posts: 13
Joined: 06 Dec 2012
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| Pension Math Story Problem |
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My husband has a small pension from a previous job he had years ago. He did hear they were offering to buy out the pensions for a $5,000 lum sum. That just seems like a bad idea. I'm trying to figure out how much he would get a month if he takes pension at age 60 instead of 65.
The paperwork basically says:
You will note that you will be entitled to $204.60 (straight life annuity) per month when you are 65 years of age. If you were to choose a Joint and Survivor Option, this amount would decrease slightly, and would be determined at time of retirement.
You may apply as early as age 60 for a reduced benefit or when you reach age 65 with an unreduced benefit. The reduction factor is 6/10 of 1% for each calendar month under age 65 at the time of early retirement.
If he takes the retirement pension at age 60, how much would he get a month?
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Mon Dec 31, 2012 12:04 am |
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startingover
Member
Cash: $ 2.90
Posts: 13
Joined: 06 Dec 2012
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Thanks for your response. When I multiply the 1.22 by 60 months I keep coming up with 73.20 less. (131.40 month). I just wasn't sure I was adding that right.
I know it's just a small amount but I'm trying to figure out if he should take it at age 60. It just seems silly they would offer only 5,000 to buy that out. In 5 years it would be a wash.
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Mon Dec 31, 2012 10:25 am |
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startingover
Member
Cash: $ 2.90
Posts: 13
Joined: 06 Dec 2012
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I just wrote an entire post asking where you came up with only 40 cents. I guess I'm tired too. (love the edit feature here)
Thank you so very much and Happy New Year!
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Tue Jan 01, 2013 1:12 am |
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