A Strategy to Maximize Your Pension Payments
If you’re the owner of a traditional pension plan, you need to be aware of an important rule when the payments start: unless your spouse elects to sign a waiver that allows otherwise, your pension benefits will be paid out to the both of you in the form of what’s called a “qualified joint and survivor annuity.” In other words, the amount you’ll get will be reduced during your lifetime, so that your spouse will continue to receive at least 50% of that amount if you happen to die first.
You could both elect instead to receive the higher single-life annuity payment, but the payments, while significantly higher, would stop at your death and not continue for the surviving spouse. This can be a real dilemma for people who want the higher payments, but are reluctant to lose that income if the pension owner doesn’t outlive the spouse.
There is a potential solution to this problem, though. Is it possible to have both the larger payments AND provide an income for your surviving spouse? Get the details from “Professor” Rick Plum, CFP® on this week’s edition of Lucia Capital Group Weekly!
Important Information:
The information provided should not be considered specific tax, legal, or investment advice and is not specific to any individual’s personal circumstances. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.
Different types of investments and/or investment strategies involve varying levels of risk, and there can be no assurance that any specific investment or investment strategy (including the investments purchased and/or investment strategies devised by Lucia Capital Group (“LCG”)) will be either suitable or profitable for a client's or prospective client's portfolio, thus, investments may result in a loss of principal. Accordingly, no client or prospective client should assume that the presentation (or any component thereof) serves as the receipt of, or a substitute for, personalized advice from LCG or from any other investment professional.
You should always seek counsel of the appropriate advisor prior to making any investment decision. All investments are subject to risk including the loss of principal. This material was gathered from sources believed to be reliable, however, its accuracy cannot be guaranteed.
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable—we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
Examples cited are hypothetical, are for illustrative purposes only, are not guaranteed and subject to potential federal and state law amendments. There is no guarantee that you will achieve the results discussed or illustrated.
Life Insurance product guarantees are subject to the claims-paying ability of the issuing insurance company and are subject to their terms and conditions.
Annuities are long-term investment products designed for retirement purposes. Guarantees are based on the claims-paying ability of the issuer subject to their terms and conditions. Early withdrawals may be subject to surrender penalties and, if taken prior to age 59½, may be subject to an additional 10% federal tax. Annuities are not FDIC insured. Certain terms and conditions apply, so please read insurance company materials carefully.
Insurance products offered through Lucia Insurance Services, LLC (CA Insurance Lic. #0H40817). Lucia Insurance Services, is licensed to offer such insurance products as life, disability, long-term care, and annuities.
Rick Plum is a registered representative with, and securities and advisory services offered through LPL Financial, a registered investment advisor and member FINRA/SIPC. The investment professionals are affiliated with LPL Financial and are conducting business using the name Lucia Capital Group, a separate entity from LPL Financial.
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