Is your retirement just around the corner? Then it’s time to rethink your finances. It’s also time to plan your dream trip to Europe, expand your home, or invest in your family’s future. If you’re about to embark onto retirement, it’s best you learn how to plan use your retirement income. Maximize what you’ve earned for years to come so you can fully enjoy your retirement.
Organize What You Have Now
If you have a retirement account, it’s time to cash it in. But how? There are many ways to get a hold of your funds, and the best method for you only depends on your goals. During this time, it’s wise to seek advice from retirement professionals; the experts at a company like Guided Choice can get you on the right path to retirement. They will help you every step of the way to plan your retirement adventures to come.
A retirement planner will walk you through the different forms of payment you can ask for. Each retirement plan has different benefits that can suit you according to your lifestyle and your needs. Below are the different ways you can receive your pay.
Lump Sum Payments
If you have $5,000 or less in your retirement account or pension, you can generally cash it out right away. Some people prefer access to a lump sum not only because of the immediate access, but also because it may be possible to obtain the same income that an annuity would allow. Lump sum payments also allow you to retain complete control over what you decide to give to your heirs. On the other hand, getting a lump sum can make it too tempting to spend quickly if it’s not handled properly.
Annuity payments differ in contracts and obligations. Generally, an annuity will deliver a beneficial payout rate that guarantees your income for life. That means you can’t outlive your income and you’ll never find yourself without money. You also won’t have investment management responsibilities, which is a relief to many who choose this plan. Yet, there are some cons. If you happen to have a large pension, the financial stability of your former employer will determine your future pension benefits. In addition, most monthly annuity payments don’t adjust for inflation. Luckily, a portion of your retirement benefits are insured by the Pension Benefit Guarantee Corporation.