Traditionally pensions may seem like relics from the past. But although few employers now offer these defined-benefit retirement plans to new hires, plenty of workers and retirees still count on them for retirement income.
Just look at this numbers.
- 62% of retirees receive pension benefits.
- 84% os state and local government employers provide pensions.
- 54% of workers expect to receive pension benefits when they retire.
- However, only 39% actually have a pension through a past or current employer.
- Only 20% of Fortune 500 companies offered new employees a pension plan in 2015, down from 59% in 1998.
Sources: Employee Benefit Research Institute, 2017 Retirement Confidence Survey; CNN Money; and Wills Towers Watson.
PARTICIPANTS MAY NEED TO MAKE CHOICES
- Between a lump sum (Invest the money yourself for potentially higher returns) amount and the more traditional annuity (receive guaranteed income for life)
- And also between a single life (you receive monthly benefits for life) or joint life (smaller monthly benefits extend over your and your spouse’s joint lives).
To choose, once should consider your and your spouse’s
- Actuarial life expectancies.
- Current health and family medical histories.
- Overall financial resources.
Other terms and conditions may apply.
Contact the Allen Pierce for more information.
Pension Plans Explained