Lump Sum vs Pension--What is the 6% Rule (Five Question Friday)

[@bmohan55]

When my wife asks "what he best way to maximize our retirement fund" I used to say "I don't know", after watching you for a few years I now say "it depends".

[@nealfellows56]

Rob, really like the five question Friday. It’s great that you cull out all of the questions and focus on a few with more detail. Thanks! Keep up the great work.

[@joeburns3302]

Thanks you Rob for the new type of video. Since early retirement 2 years ago i have stop trying to be best in all my finances. I merely try to be good in my choices. Thank you for helping me in that.

[@Jeff-Dr]

Wish I had this info when I had to make a choice. I decided to take the payout. It has worked out well, they offloaded the pension to a company none of us had ever heard of. At least I have control of it now. Good info thanks

[@alcw625]

rob...thanks for doing this. I have learned so much from these questions and answers. You're honest when you don't know and have no agenda to steer people to some mantra, product or idea.

[@mikephilpot9857]

Great video. So glad you’ve decided to do follow-up videos addressing questions or topics that you could not get to during your lives. ❤

[@rickstephan6707]

FWIW...When I retired 2 years ago, I did the 6% calculation on my pension estimate and the result was 5.8% (if memory serves). That AND the fact that I am spouseless, led me to the lump sum option (into T-IRA). I have no regrets (currently).

[@monalisa233]

Please continue these!

[@neeferpd]

Hi Rob, yes I do like your 5 question Friday idea! I watch every stream and read chat as it goes by too. Nice to know you'll be looking at the questions and following up on some. Good work!

[@TedWesterfield]

Good questions and concept for a video. Nice that you have increased time to talk in greater depth on a fewer number of questions.

[@akumar234]

Bob, great idea to answer selected 5 questions instead of any random pic. Thanks Keep it up.

[@RobCoulter-h1p]

Rob, I really enjoyed the new 5 question Friday format! Allows for addressing current topics in an organized and concise video. Please keep it going!

[@jaymetheaccountant]

Been looking forward to this since you announced on Monday's live show. Keep them coming Rob!

[@WilliamMcCarty-q9v]

I did enjoy. Hope you keep it going. Happy Holidays!!

[@paulh6096]

Subway stops the 5 dollar footlong, Rob starts the 5 question Friday. Love it!

[@s55b]

Thank you.

[@RightYouAreKen01]

Love this idea Rob! Always look forward to your Q&A sessions!

[@keithmachado-pp6fv]

Don’t forget when you are right at the top of the 12% bracket, Roth conversions could cost 27%. For example if you have $20k of dividends or cap gains in zero bracket then a $20k conversion makes that taxable at 15% on top of the 12% of ordinary income.

[@beauthestdane]

Looking forward to more of this.

[@servererrorpleasetryagain2707]

Like the format and content. Thanks for what you do. I often refer folks to your channel to get smarter about all this.

[@SFOtoLIH]

Keep up five question Friday!

[@mattheinz3558]

I really enjoyed this would like for you to continue this every Friday.

[@dianediliberto1876]

Excellent video. Thank you.

[@readyplayer2]

Regarding "best travel card" -- I prefer cash back cards, like Costco's (Citi issued) Visa card; 1% - 4% cash back, depending on what you're buying, and no foreign transaction fees. Points and miles cards tend to lock in you to a single airline or hotel, and the award requirements continually go up while you're saving. If you have, say, an Alaska Airlines card, chances are good that you'll be tempted to book travel on Alaska even if it's a fair amount more expensive than, say, Delta, because you'll accrue miles.

[@erickarnell]

Great format. Thanks for your time.

[@cynthiaowens9107]

For pension vs. lump sum…consider the health & dependability of the company, if they are paying out the pension! May be here today, gone tomorrow…or they change the mechanics of the pension pay out, I’m thinking decreasing the amount or making negative changes to it.

[@julieg.5718]

Yes, I really enjoyed the rotation of the five questions. Thank you for your work!

[@Jeff-Dr]

Great idea, enjoyed hearing more of the questions. Thanks!

[@Wawalsh1234]

Love the format, thanks.

[@DavidP-t7h]

Great idea, Rob. Love the new segment. Big ‘yes’ for ‘5 Question Friday’.

[@keithmachado-pp6fv]

Valid point on credit cards. I agree with chase. Interesting on the reserve which I am not familiar with.

[@mikesurel5040]

This was great. More of these please

[@stephenholcomb9278]

I really like the format of the Friday Q&A Rob. Keep it going! 2 responses to you on this episode. I absolutely think the financial well being of having a paid for home far far outweighs netting a percent that you will probably blow on a sports car or something similarly stupid :). Second, I’m not familiar with the 6% guide on lump sum pensions, but my wife and I each have pensions to look forward to, and my calculus is to definitely lump sum it. We have no COLA provisions and as long as I make 5% or better I’m keeping up with what the payout is. I intend on rolling the LS’s as we turn 60 into VTI in a traditional IRA, with some Roth conversions as appropriate. Anywho, just my thoughts.

[@BobDobbs681]

I like the format but wish you used chapters or had time stamps for the questions. I am only interested in certain ones.

[@bulrack66]

Excellent! Thanks Rob

[@terryadams1830]

I like the format Rob!

[@MrBass5er]

Rob, Great video! ...keep it going! 👍🏻

[@georgehernandez4105]

good program

[@johnbeeck2540]

Great format Rob! Keep them coming! Happy Thanksgiving!

[@mtgwdefender]

Yes, Rob! I like this format. All 5 questions of today were helpful for me

[@mattkavanaugh5623]

A big YES in favor of FQF :)

[@MRkriegs]

good format!!!

[@ArthurDentZaphodBeeb]

Lump Sum 110% (at least if interest rates are low). Control your own destiny. If you die early, you keep all the money. SO took LS pay out 4 years ago when interest rates were low (= high pension payout). Since then, market has boomed and interest rates have gone up significantly (= low pension payout and high stock market return). Her coworkers (those who chose to stay) are grumbling that their pension payouts have dropped significantly and they missed the big market run (lose-lose) - many say they've essentially worked for free for the last 4 years based on the significant drop in payouts due to high interest rates.

[@keithmachado-pp6fv]

Good for you. When interest rates are high I agree the lump sum is less but also you can lock in to some good rates. In my case at 4% it is a 26 year break even. At 5% it’s 29 years. I took the lump sum.

[@BearPapa49]

I took the lump sum and making more money with CDs for now and out paying what I would have gotten if I went pension. Plus I am not spending or touching my principal at all . Plus my wife’s pension and ssa . I’m good very good .

[@wilma6235]

Ok I really like the 5 questions shorter video. @Rob Berger

[@stevebenson1802]

I do like 5? Fri! Keep it coming.

[@keithmachado-pp6fv]

Good video.

[@Bullseye120]

@ Rob Berger, great new format! Love it!

[@daveschmarder-1950]

This is good Rob. Happy Thanksgiving.

[@Will67267]

Unfortunately, I only have a monthly pension option. No choice in my case.

[@Bob-be2pj]

Would an assessment of the company and how well funded the pension plan is be a consideration?

[@davidperry2725]

Absolutely, and they are required by law to provide you with the annual report.

[@Austin-fc5gs]

Commenting to say i like 5 question fridays

[@chumbawumba1959]

Rob, recently discovered your channel and have added it to my top tier for financial advice in retirement. The production quality is very high and your style is very easy to follow. The one suggestion is ... can you please add **chapter markers** ... especially for something like this one - where not all of the FIVE are of interest to every viewer. Cheers and I look forward to your upcoming videos! HAPPY THANKSGIVING :)

[@rob_berger]

We do, but it takes a few hours.

[@keithmachado-pp6fv]

6% would be lump sum every time. At 7% the break even is 27 years if you can get 4.5%. At 6% if is 30 years+

[@youarehere1251]

Just like winning a lottery 😜

[@jimpearson7743]

Was this mis-worded? Take 12 months of distribution "and divide it INTO the Lump Sum..." Isn't it actually: Take 12 months of distribution "and divide it BY the Lump Sum..." ??? ... and if it's > 6% ...

[@wilkop1390]

Great format, Rob. Quick, concise and informative. Thanks for taking the time to compile and answer these questions.

[@70qq]

🤘

[@jpHarkins-kb2vv]

Rob is ALWAYS wearing same awful shirt and repeating himself. RAMBLING on & on Vey vey.

[@dancooper6002]

First! Only 44 seconds ago!

[@user-br7rm3ol2s]

If you are close to retirement and already won the game, meaning you can cover your expenses with a lower safer return, I wouldn't have 75% in this extremely over valued market. You are asking for trouble.

[@jpHarkins-kb2vv]

Fidelity sucks. There is class action law suits.. I was wth fidelity for over 29 yrs.

[@jasonnelson6197]

Great content!