Need a Little Financial Advice

[Dr.Midnight]

Out of the blue today, I got some information from a company I used to work for about my pension with them. It seems like they're giving anyone with a pension valued at $50,000 or less some options. You can get your money in a lump sum. You can get your money broken up into payments. You can also wait like normal until retirement age to get your cash.

They're going to send more detailed information starting in October to better help me make a decision, but I wanted to see what some of the more financial savvy folks on here thought. Thanks in advance for the input.

 

[SSGSAD]

Out of the blue today, I got some information from a company I used to work for about my pension with them. It seems like they're giving anyone with a pension valued at $50,000 or less some options. You can get your money in a lump sum. You can get your money broken up into payments. You can also wait like normal until retirement age to get your cash.

They're going to send more detailed information starting in October to better help me make a decision, but I wanted to see what some of the more financial savvy folks on here thought. Thanks in advance for the input.

Depending on the kind of Pension, it is, you will pay taxes, and maybe a penalty .....

so you MIGHT end up, with around $30,000 cash .....

I am NOT a financial Genuis, and I did NOT sleep at a Holiday Inn Express last night .....

 

[GodFearinGunTotin]

That happened to me. Mine was a combination of a pension plus a 401K. I took the lump sum and rolled it over into an IRA. My company had already gone bankrupt once and I decided I didn't want them associated with my pension for any reason.

ETA: I see you're in Monroe county. A couple of my friends use David Hayes up there for their retirement planning. You might give him a call. I use SBC Wealth Management up on Indy for mine. I can give you a contact name up there if you wish.

 

[Dr.Midnight]

I kind of figure Uncle Sam is daring me to take the lump sum payment. He's just itching to drop the tax hammer on me. The thing is I have been scraping together all the spare cash I could for the last year so I could put it towards buying a house. Depending on the amount I'm owed, it could significantly alter my schedule in a good way. I'm eager to read the information they provide.

 

[GodFearinGunTotin]

I kind of figure Uncle Sam is daring me to take the lump sum payment. He's just itching to drop the tax hammer on me. The thing is I have been scraping together all the spare cash I could for the last year so I could put it towards buying a house. Depending on the amount I'm owed, it could significantly alter my schedule in a good way. I'm eager to read the information they provide.

If you roll it over to an IRA, there will likely be no tax implications. If you take it as a cash-out, liquidation sort of thing, yeah--you'll pay the taxes and the 10% penalty on the earnings you've recieved. I don't know how old you are but if you're young, you still have the possibility of the miracle of compound interest helping you out if you leave it in a retirement account...and leave it in there until you're ready to retire.

 

[17 squirrel]

Don't be foolish and cash out your pension.. Find yourself a new money man and transfer your pension to a new account..
Compound interest is one of your pensions best friends.

 

[Dr.Midnight]

That happened to me. Mine was a combination of a pension plus a 401K. I took the lump sum and rolled it over into an IRA. My company had already gone bankrupt once and I decided I didn't want them associated with my pension for any reason.

ETA: I see you're in Monroe county. A couple of my friends use David Hayes up there for their retirement planning. You might give him a call. I use SBC Wealth Management up on Indy for mine. I can give you a contact name up there if you wish.

Thanks for the offer. I'll keep that in mind.

 

[SSGSAD]

I kind of figure Uncle Sam is daring me to take the lump sum payment. He's just itching to drop the tax hammer on me. The thing is I have been scraping together all the spare cash I could for the last year so I could put it towards buying a house. Depending on the amount I'm owed, it could significantly alter my schedule in a good way. I'm eager to read the information they provide.

If it is worth it to YOU, then save some back, 5-10k, for repairs, water heater, etc., and GO for IT !!!!!

JMHO, make sure you are going to STAY there !!!!!

 

[olhorseman]

JMHO, if you are less than 10 years from retirement don't take the buyout, more than 10 years roll it over into an IRA or 401 if your plan administrator allows it. I would never take a cash buyout because of the taxes and possible 10% early withdrawal penalty. You already have a plan in place for buying a home, keep working that plan. Money in retirement is like ammo in a gunfight, nobody complains about having too much

 

[Dead Duck]

Need a Little Financial Advice

Don't Get Married!

 

[Dr.Midnight]

Don't Get Married!

Thank you Charles Schwab.

 

[Cameramonkey]

I have a great fiancial advisor and I believe he will come down there to you. I've known him for over 15 years. He is a practitioner of the LEAP system, which takes EVERYTHING into account for the financial picture. Instead of treating investments, income, insurance, etc in their own silos, this system makes them overlap and work together.

https://new.leapsystems.com/

PM me if you want his info.

 

[longbow]

Roll it. Don't cash it.....

 

[Dr.Midnight]

Thanks for all the suggestions and offers guys!

 

[Brandon]

Roll it over.

 

[Rookie]

Put it all on red.

 

[Brandon]

Put it all on red.

I disagree. Should be all on Green.

 

[woowoo2]

The thing is I have been scraping together all the spare cash I could for the last year so I could put it towards buying a house.

I know that with an IRA, you can take up $10K out, penalty free, for the purchase of your first home. Not sure what rules cover your pension. One thing is for sure, the company is not doing this to benefit you.