Should I Cash Out My Pension for a $24k Lump Sum or Get $100 a Month for Life?
Briefly

Deciding between a lump sum pension payout and lifetime monthly payments is complicated, especially when age factors into longevity and investment strategies. A Reddit user faced this dilemma choosing between $24,000 at once or $100 monthly for life. The break-even analysis suggests that living beyond age 64 favors monthly payments due to longevity. However, immediate financial needs may lead one to opt for a lump sum, which could be used for investments or significant purchases, depending on individual financial circumstances and risk tolerance. Understanding both options is essential for making a confident choice.
Choosing between a lump sum payout or monthly payments is not just a mathematical calculation but involves consideration of life circumstances, financial goals, and personal risk tolerance.
The break-even point for the monthly payments option is 20 years, requiring the Redditor to live to at least 64 to make the pension option worthwhile.
Read at 24/7 Wall St.
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