- Joined
- 18 July 2005
- Messages
- 2,636
Wow.... lot of thoughts! I really appreciate the input....
I have no plans to retire immediately... I could start the pension now, but at a reduced amount.
The pension (with a 65% spouse option) pays about $3400/mo if I start in 2022, or $2700 if i start in 2019... or $400k today.
Annuities were suggested because of "the guarantee" it would provide.... although, especially as I learn more about variable annuities, there is risk involved. I would hate to take this lump, put it into a 401k, and invest it in a stock portfolio... and the market take a big drop! Seems like that at this point, safety is imprtant for this investment.
Ford is motivated to get pension obligations off their books.... it's a liability that they feel is holding back their stock growth from a balance sheet perspective. They claim that the buyout is a "10% premium" but well, as previously said, they're not doing this for me.
Given your figures- I'd take the lump sum and throw it into an IRA.
Within the IRA i'd purchase some solid dividend paying companies and some highly rated laddered bond funds. A portfolio with a 4% yield will net you 16,000 in your first year alone whether or not the market goes up or down. Given the power of compounding and the tax advantages of the IRA, you will most likely have about $1MM in the account by 2022.
**edit** Again - Vanguard and Fidelity are excellent choices to examine for low cost accounts, low cost mutual funds and advice. I would start there first.
Last edited: