Single Life Annuity vs Joint Survivor Annuity
Should I select a single life annuity or joint survivor annuity for my pension plan?
The type of annuity you choose depends on your circumstances.
Choosing between a single life annuity and a joint survivor annuity for your pension plan monthly payments is a major choice. The choice you make could have a major impact on the pension funds you and your spouse will receive.
A single-life annuity offers the highest pension payouts during a lifetime, ceasing upon death. However, these monthly payouts will be smaller than if you had chosen a single-life annuity.
One retirement planning strategy includes choosing a single life annuity and using the extra money to buy life insurance. The insurance benefit can provide for your surviving spouse after you pass. Our financial advisors can help you assess whether this strategy is right for you.
Another consideration is whether you have enough retirement savings to cover your spouse’s requirements. If you lack sufficient resources or you cannot attain necessary insurance, a joint survivor annuity may be a better choice. This option would provide your spouse with pension survivor benefits after your death and guaranteed income until their own death. Some policies allow your spouse to maintain employer health insurance after your death when selecting a joint-survivor annuity.
When deciding, remember if you’re married, most plans will only allow you to choose a single life annuity if your spouse waives the joint and survivor annuity. Keep in mind, the option you choose can significantly impact your and your spouse’s annuity payment income when you reach retirement age. This is a complicated decision, so get professional guidance before you make your choice.
The H Group, Inc. financial advisors can assist you in making the best choice for you and your family. Our advisors average 20+ years of experience and are CFP® certified professionals. Connect with an advisor near you today.
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