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Lasers retirement question - which plan/option?
Posted on 11/26/18 at 7:07 pm
Posted on 11/26/18 at 7:07 pm
My wife works for an agency and is about to take disability retirement. I am hoping someone here is knowledgeable about the options. They are described here.
We are 51, and her life expectancy is under 1 year. Any reason to not choose maximum? Are we talking about the same amount of money no matter which plan?
We are 51, and her life expectancy is under 1 year. Any reason to not choose maximum? Are we talking about the same amount of money no matter which plan?
9
Posted on 11/26/18 at 8:28 pm to AlxTgr
When I retired, I chose the lesser monthly payment whereby my spouse received the same amount after I die and the rest of her life. I can’t tell you what is best for you. Either talk to a financial planner or the folks at LASERS who can clearly explain the differences.
Posted on 11/26/18 at 8:34 pm to slaphappy
quote:She's going to talk to someone at lasers tomorrow.
Either talk to a financial planner or the folks at LASERS who can clearly explain the differences.
Posted on 11/26/18 at 8:37 pm to AlxTgr
Good luck. They were very helpful to me.
Posted on 11/26/18 at 9:06 pm to AlxTgr
quote:
We are 51, and her life expectancy is under 1 year.
I don't have anything to contribute to your thread, but this brought tears to my eyes. Praying for you and your family.
Posted on 11/26/18 at 9:28 pm to lnomm34
Same here. Prayers are with you both Alx...
Posted on 11/26/18 at 9:34 pm to AlxTgr
Really sorry to hear that man
Posted on 11/26/18 at 10:01 pm to AlxTgr
Sorry that you’re facing these sorts of decisions. Are you covered by a pension or retirement plan of your own? Are you underfunded in your own retirement accounts? Hard to suggest which option is best without full knowledge of your financial picture.
Posted on 11/26/18 at 10:56 pm to AlxTgr
So sorry brother.
I am not any kind of financial person but sounds like option 2 would be the greatest benefit to you under the circumstances.
I am not any kind of financial person but sounds like option 2 would be the greatest benefit to you under the circumstances.
Posted on 11/26/18 at 11:09 pm to AlxTgr
Sorry to hear about your situation. I would inquire about the rollover option as well. In addition to talking to lasers representative, I’d speak faith a Financial Advisor.
It is also tough to give definitive advice without know all the retirement accounts information.
It is also tough to give definitive advice without know all the retirement accounts information.
Posted on 11/27/18 at 9:13 am to hungryone
quote:Self employed. Doing things on my own including IRAs, stocks and some mutual funds.
Are you covered by a pension or retirement plan of your own?
quote:Probably.
Are you underfunded in your own retirement accounts?
If it matters for these plans, she's got right at 15 years in.
Posted on 11/27/18 at 10:20 pm to AlxTgr
Sorry to hear about your situation. Prayers sent.
As it relates to the retirement / disability monies, always go with a lump sum option if available. It’s portable, and you can conservatively invest the lump sum in order to either grow, or create an income stream without surrending the principal / balance.
Talk to a professional advisor you trust. If you don’t know one, ask for a recommendation from your attorney, banker or CPA.
As it relates to the retirement / disability monies, always go with a lump sum option if available. It’s portable, and you can conservatively invest the lump sum in order to either grow, or create an income stream without surrending the principal / balance.
Talk to a professional advisor you trust. If you don’t know one, ask for a recommendation from your attorney, banker or CPA.
Posted on 11/28/18 at 12:46 am to Kreg Jennings
Is lump sum even an option? Not sure that it is.
I think it’s just deciding on the pension payments. Granting ones spouse your pension payments for the rest of their life will reduce the amount of the monthly payment as opposed to only having the payments available to the retiree for the rest of their life.
In different situations than the OP it is more of a calculated decision. Often the money saved in going with the higher pension plan for only the retiree can be used to purchase a life insurance plan or invested elsewhere in the event the retiree were to pass away before his/her spouse. Since the spouse would completely lose the income once the retiree passes away and would be completely dependent on the difference that was invested.
I think it’s just deciding on the pension payments. Granting ones spouse your pension payments for the rest of their life will reduce the amount of the monthly payment as opposed to only having the payments available to the retiree for the rest of their life.
In different situations than the OP it is more of a calculated decision. Often the money saved in going with the higher pension plan for only the retiree can be used to purchase a life insurance plan or invested elsewhere in the event the retiree were to pass away before his/her spouse. Since the spouse would completely lose the income once the retiree passes away and would be completely dependent on the difference that was invested.
Posted on 11/28/18 at 6:49 am to AlxTgr
Yes, talk to a LASERS rep. And there are time limits that come into play when initiating retirement and LASERS payments, so take those into account. The rep can give you close estimates of the actual monthly retirement payment for each option (maximum around 30% of current monthly income? Not sure if the multiplier in effect at 15 years is 2 or 2.5). And God's mercy on you and your wife being in this situation.
Personally, I'd take the option that pays the beneficiary the maximum amount (option 2?). The key phrase here, "payments for the rest of YOUR life." I would not exit the plan to get an effective "lump sum payment". LASERS would return only the monthly contributions made by employee (not any employer's matching amount?) with minimal interest. No one's investment skills will match the return that will come from remaining in a life-long "defined benefit" plan like LASERS.
If you're are worried about funding your heirs, stash away other funds for that purpose. This LASERS account was never intended to be about that.
I'm in TLSR which is similar to LASERS, and practicing what I preach.
Personally, I'd take the option that pays the beneficiary the maximum amount (option 2?). The key phrase here, "payments for the rest of YOUR life." I would not exit the plan to get an effective "lump sum payment". LASERS would return only the monthly contributions made by employee (not any employer's matching amount?) with minimal interest. No one's investment skills will match the return that will come from remaining in a life-long "defined benefit" plan like LASERS.
If you're are worried about funding your heirs, stash away other funds for that purpose. This LASERS account was never intended to be about that.
I'm in TLSR which is similar to LASERS, and practicing what I preach.
Posted on 11/28/18 at 9:14 am to SurfOrYak
Updates. Wife claims Lasers rep would not help her. She is going to try again.
Investment guy claims there is a way to get estimated payments by filling out a form. Will try today. He was really against the maximum plan. I will not need a lump of money at her death, as I have life insurance on her.
Leaning towards 2a. I could live a while and have a 12 year old. I would like to stay on her health plan(it's great) and I am not sure what they will pay towards it, if anything. I would have to pay my own at my work since I am an owner.
Investment guy claims there is a way to get estimated payments by filling out a form. Will try today. He was really against the maximum plan. I will not need a lump of money at her death, as I have life insurance on her.
Leaning towards 2a. I could live a while and have a 12 year old. I would like to stay on her health plan(it's great) and I am not sure what they will pay towards it, if anything. I would have to pay my own at my work since I am an owner.
Posted on 11/28/18 at 9:56 am to AlxTgr
Brutal situation.
Make the most of your time with her.
Certainly discussing the options is worth the time.
I would guess with the limited time left, either as much cash as possible or an option where you get an income for life would be reasonable.
Make the most of your time with her.
Certainly discussing the options is worth the time.
I would guess with the limited time left, either as much cash as possible or an option where you get an income for life would be reasonable.
Posted on 11/28/18 at 12:07 pm to AlxTgr
The lump sum seems like a poor choice to me—if, as someone said upthread, she’s just going to get back what she put in, no interest. With only 15 years in, it’s not going to be very much.
If she elects to take a benefit that pays you for your remaining lifetime, it’s a far better choice for you, especially if she’s covered by life insurance. Those pension dollars can help you boost your own tax-deferred retirement savings. Or, they can be used to pay your portion of a health insurance plan.
If she elects to take a benefit that pays you for your remaining lifetime, it’s a far better choice for you, especially if she’s covered by life insurance. Those pension dollars can help you boost your own tax-deferred retirement savings. Or, they can be used to pay your portion of a health insurance plan.
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