A worker nearing retirement with an employer pension plan will usually need to decide between a single-life plan and a joint-and-survivor plan. The single-life plan terminates when the worker dies, and the joint-and-survivor plan continues for as long as either the worker or his or her spouse survives. Not surprisingly, the joint plan offers a lower monthly payment, because it has a longer expected payment period.<\/p>\n
If the employee is likely to die first, a joint pension is usually the prudent choice. But some professionals will advocate a strategy known as \u201cpension maximization,\u201d or \u201cpension max.\u201d The strategy involves taking the higher single-life payout and using part or all of the extra income to purchase life insurance. If the employee dies first, the spouse gets a death benefit that, assuming proper planning, is large enough to generate the same income as a joint-and-survivor plan. If the spouse dies first, the worker cancels (more…)<\/span><\/a><\/p>\n","protected":false},"excerpt":{"rendered":" A worker nearing retirement with an employer pension plan will usually need to decide between a single-life plan and a joint-and-survivor plan. The single-life plan terminates when the worker dies, and the joint-and-survivor plan continues for as long as either…<\/span><\/p>\n