Pension: Wait or Cash out Early?

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  • #2736

    When I tell people I have a pension from a private sector job early in my career, I am greeted by oohs and ahhs. Yes, I am one of the lucky few who will receive a pension when I reach retirement age in about 12 years. Recently, I was given an opportunity to cash out my pension. Here is my offer:
    Receive $60,000 now (subject to taxes) or wait until 65 and receive $2000/month. My first reaction is to turn the offer down as simple math tells me if I live just two years beyond 65 I am better off waiting. This weekend I discussed the choice with several people and received very different advice: half said take the money now and invest it and the other half said wait. I would love to hear thoughts from the SUM180 community. Should I cash out or wait?


    I think you should wait. 12 years is a while but I don’t think its enough time to be aggressive in your investment. I think anything other than the pension would bring a low return on investment.

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