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Stephen G.
Stephen G., Sr Financial Expert
Category: Finance
Satisfied Customers: 7197
Experience:  Extensive Experience with Tax, Financial & Estate Issues
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I am 62 and have a pension valued at 450,000. I will be

Customer Question

Hello, I am 62 and have a pension valued at 450,000 . I will be retiring in October and have to do something with it , any ideas for tax help. Chris
Submitted: 1 year ago.
Category: Finance
Customer: replied 1 year ago.
IS SOMEONE WORKING FOR ME I ALREADY PAID. AND NO RESPONSE
Customer: replied 1 year ago.
STILL NOTHING ANYONE HERE
Expert:  Stephen G. replied 1 year ago.

What type of help are you looking for?

As far as what to do with it generically, the only thing you can do is roll it over to an IRA. It should be done directly from the Trustee of your Pension Plan to the Custodian/Trustee of your new IRA Plan. All the banks and brokerage houses have Prototype Plans for their IRAs which all do basically the same thing.

So, the decision comes down to your investment decisions.

If you want to have the money managed for you or you want to manage it yourself.

Your tolerance for risk has to be evaluated and determined and the investment mix, stocks, bonds, treasury obligations, should be matched to your acceptable level of risk/reward.

Interest rates are still low, basically nothing on secure investments, so if you are expecting to have to withdraw funds regularly to meet your living requirements, you are probably going to have to invest in Blue Chip companies that have a good history of increasing their dividends. Right now if you are able to average 3.5% - 4% on dividends you will be doing exceedingly well.

You need to be wary of longer term bonds as those investments should only be made in those securities that your are able to hold to maturity so that you can recover your principal and therefore won't lose principal to rising interest rates (if you hold to maturity).

So, those are a few things to mull over and after you have had a chance to think about these things if you have any follow-up questions, or if I can clarify anything, please let me know.

Steve G.

Customer: replied 1 year ago.
MY COMPANY DOES OFFER A SINGLE ANNUITY OR ADD MY WIFE FOR LIFE AT A REDUCED RATE . 2,750 SINGLE ANNUITY OR ADD MY WIFE 2375 FOR LIFE.
Customer: replied 1 year ago.
PER MONTH
Expert:  Stephen G. replied 1 year ago.

What's the guarantee period?

Expert:  Stephen G. replied 1 year ago.

That's one option as long as you aren't going to need any lump sums for anything. It will also mean that between 50% & 85% of your Social Security benefits will be taxed along with the annuity payments.