Pension Maximization

A pension is a consistent retirement income stream that cannot be outlived. When someone is ready to collect their pension, they’re given many “pension options”. Making the right decision can be tricky. When preparing for retirement, a pension can provide stable income for both the retiree and their family. If you’re lucky enough to be able to collect a pension at retirement, you will be faced with an important decision. Like social security options, this decision can affect the recipient and their family permanently.

Before officially deciding to retire, (those eligible) will usually seek out their pension statement. This statement often consists of a few basic options. Some of these options allow the retiree to provide income to members of their family. For example, a “Joint and survivor” option may provide income to a spouse for the rest of their life. A “ period certain” option may continue payments for a specific amount of time to a named beneficiary. When clients come to us with questions about their pensions, we seem to drift towards a common outcome. After explaining the different options, how they work, and the pros and cons of these options, the question becomes “So what option should I pick?”.

This is the main reason clients ask us about their options. There are 2 very popular main concerns. 1. Will my spouse/family be ok if something happens to me? 2. How do I maximize my pension income? Ironically enough, pension options often offer to solve one of these concerns, not both. If someone elects to have income continue to their spouse, their payment will be less. If not, they risk pre-deceasing their spouse and jeopardizing their family’s financial stability. This is where we work with clients and utilize creative solutions to help them secure their perfect balance of income and security.