"To figure it out, calculate your break-even age - the point where the total from monthly payments equals the lump sum. For example, $100 a month versus $24,000 upfront works out to 240 months, or 20 years. That means if you start at 65, you'd break even at 85. If you think you'll live beyond 85, go with the monthly checks. If not, the lump sum may be smarter."
"Still, it's not just about math. The monthly payout offers stability - guaranteed money for life, no matter what. But a lump sum gives you flexibility. You can invest it, grow it, or use it for something meaningful right now - like taking that once-in-a-lifetime trip while you're still healthy enough to enjoy it. The best choice depends on your priorities: security later or freedom now."
Most workers must fund retirement themselves because private-sector pensions have largely vanished, often replaced by 401(k) plans that place saving responsibility on employees. Employer matches are sometimes available but not guaranteed. Self-employed workers receive no employer retirement contributions but gain scheduling flexibility. Comparing a lifetime pension and a lump sum requires calculating a break-even age based on total payouts over time. For example, $100 monthly versus $24,000 equals 240 months, or 20 years, so starting at 65 breaks even at 85. Monthly payouts provide guaranteed lifetime income, while lump sums offer flexibility to invest, grow, or spend now. Real decisions require considering time value of money and personal priorities.
Read at 24/7 Wall St.
Unable to calculate read time
Collection
[
|
...
]