Workers fortunate enough to get a
traditional pension through their jobs generally have a second
guaranteed source of monthly retirement income. Most private-sector
pension plans are insured by the PBGC, which guarantees pension benefits
up to certain annual limits and will pay out benefits if your former
employer goes out of business. However, workers with traditional
pensions are increasingly being offered lump-sum pension payouts, which
do not come with the same protections. If you don't manage a lump sum
prudently or you live longer than you expected, you could end up
spending that money too quickly.
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