The interest rate needed to generate $90,000/yr with $1,080,270 is around 8.331%.[Topic is now in Personal Finance (Not Investing) - mod mkc]
Monthly payments (annuity) is $90,000 / year until age 62; then it drops to $64,000/year.
The lump sum is valued at $1,080,270 with current interest rates (which I don’t see dropping much, if at all, by September?).
The interest rate needed to generate $64,000/yr with $1,080,270 is around 5.924%
Current risk-free rate is about 4.4%. (10-yr Treasury)
For me, if the pension is covering the living expenses after retirement, then no question, I'd take the pension.
If not, then I'd take the lump sum and spend it.
Statistics: Posted by lzq — Sun Jun 09, 2024 3:23 am — Replies 23 — Views 2096