• Home
  • E-Booklets
  • Pay Less Tax
  • Privacy Policy
  • Cheatsheets
  • Contact Us
  • About us

Retirement Income

New Ways to Get More Retirement Income

  • Retirement Advisors
  • Retirement Insurance
  • Retirement Investing
  • Retirement Living
  • Retirement Planning

Stretch Your Pension to Two Lives

Posted on March 3, 2013 by bobrichards

When a person retirees from an employer with a pension plan, the retiree is typically offered to receive payments over his own lie or over the life of he and his spouse (i.e. joint life payout). The single life option is most popular because the monthly pension payment is higher.

Therefore, it's common to find two spouses and one has a pension that stops when the pension recipient dies. Yet both spouses rely on that pension income for their living needs. Here's a simple and easy solution that makes economic sense and saves financial hardship for the surviving spouse. The inexpensive way to protect against financial hardship is to own term life insurance to replace the pension income.

Earlier this year, I obtained a $100,000 policy for a 70-year-old male for a premium less than $200 monthly (20 year level term). Of his $1,200 monthly pension, we used less than $200 to pay the premium and slightly reduced their household spendable income. But here's what we gained.

If he predeceases his wife (women statistically outlive men by 7 years) , his wife will receive this $100,000 tax free from the insurance policy. Assuming she is age 80 at the time he passes, the $100,000 invested for income in a life annuity, gives her $1000 monthly of income to offset the loss of his pension (most of the monthly payment is tax free). Alternatively, she could invest in a fixed income investment at a hypothetical 6%, enjoy $500 monthly and dip into principal when and if needed. In this scenario, there are potentially funds remaining for her heirs.

How much does your household income change if either spouse passes away and a pension or social security check disappears? Now may be the time to make an inexpensive financial commitment to guard against financial hardship for the surviving spouse.

How to Prosper and Thrive In Retirement

For those already retired seeking to improve their finances
  • The 4 most important issues for any retiree and a quick plan to address each
  • The overlooked annuitization of assets to make your money go farther and reduce risk
  • An easy way to save money on health coverage
  • You don’t need to be rich to plan your estate like this
  • A few simple lessons can reduce stress and bring more joy in your retirement year. Stop worrying and learn the simple
  • actions to take.

    You might also like:

    • Use Life Insurance in Estate Planning to Treat Beneficiaries Equally
      Use Life Insurance in Estate Planning to Treat…
    • Retirement Solutions— Difficult Trends and What You Can Do
      Retirement Solutions— Difficult Trends and What You Can Do
    • Estate Financial Planning Has Nothing to Do With Your Wealth
      Estate Financial Planning Has Nothing to Do With Your Wealth
    • Average Retirement Savings by Age – How Do You Compare?
      Average Retirement Savings by Age – How Do You Compare?
    • Social Security Office Cheating Retirees
      Social Security Office Cheating Retirees
    • What's the True Cost of Senior Healthcare
      What's the True Cost of Senior Healthcare

    Filed Under: Retirement Planning

    About bobrichards

    Bob Richards
    Editor | Involved in Various Marketing Positions within the Financial Services Industry

    Leave a Reply Cancel reply

    Your email address will not be published. Required fields are marked *

    Second place winner best retirement blog

    SH award winner SMALL (1)

    Not Enough Savings to Retire?
    Learn Six Ways to Earn Retirement Income (from home)

    You do not need special talents, skills, computer knowledge, etc. We show you multiple ways others are working a few hours a week to generate a comfortable retirement income.

    Download Free Copy

    Latest Posts

    Update on Social Security Cash Flow

    Update on Social Security Cash Flow

    What's the True Cost of Senior Healthcare

    What's the True Cost of Senior Healthcare

    Social Security Office Cheating Retirees

    Social Security Office Cheating Retirees

    Use Life Insurance in Estate Planning to Treat Beneficiaries Equally

    Use Life Insurance in Estate Planning to Treat Beneficiaries Equally

    Estate Financial Planning Has Nothing to Do With Your Wealth

    Estate Financial Planning Has Nothing to Do With Your Wealth

    Categories

    • 401K IRA Roth Withdrawals, Distributions, and Rollovers
    • Annuities for Income
    • Estate Planning
    • Retirement Advisors
    • Retirement Insurance
    • Retirement Investing
    • Retirement Living
    • Retirement Planning
    • Social Security
    • Supplemental Retirement Income
    • Tax Savings
    • Alternative Investments
    • E-Booklets
    • Pay Less Tax
    • Privacy Policy
    • Cheatsheets
    • Contact Us
    • Subscribe
    • Sitemap

    Recent Posts

    • Update on Social Security Cash Flow
    • What's the True Cost of Senior Healthcare
    • Social Security Office Cheating Retirees
    • Use Life Insurance in Estate Planning to Treat Beneficiaries Equally
    • Estate Financial Planning Has Nothing to Do With Your Wealth

    The Retirement Income Blog

    25A Crescent Drive #1508
    Pleasant Hill CA 94523
    T: 844-887-4131
    E: [email protected]

    © 2018 Retirement Income