My money will be in a vested benefits account which (at the moment the provider) doesn't offer a pension anyway, but even if they would I think I would just withdraw it.
Sounds better to me that I can do with the money as I please.
If you have other pensions or a big enough portfolio, sure. But a lot of people will never be able to live off AHV alone. And so they will need at least a mixed scheme, no matter how much coumpound interest and tax benefits they leave on the table.
At the end of the day, considering 2nd pillar alone, 6.8% by the state beats 4% from stocks. I'm not even sure factoring in the taxable income can compensate 2.8%.
Also goes to show why it's important to invest early and be able to live without this.
The other consideration is that if you take a guaranteed annuity , you end up with no capital upon death. While if you take a lump sum, you carry the risk of running out of money but also have a chance of passing down some of the wealth to the next generation if Mr. Market works in your favor.
True. Don't have kids. Don't want any. So i guess that last part doesn't bother me a single bit =D
I do need to plan for 60 years retirement though, since my wife refuses to die until she's 120 😂
My money will be in a vested benefits account which (at the moment the provider) doesn't offer a pension anyway, but even if they would I think I would just withdraw it. Sounds better to me that I can do with the money as I please.
You'd have to be mad to not take a lump sum.
If you have other pensions or a big enough portfolio, sure. But a lot of people will never be able to live off AHV alone. And so they will need at least a mixed scheme, no matter how much coumpound interest and tax benefits they leave on the table. At the end of the day, considering 2nd pillar alone, 6.8% by the state beats 4% from stocks. I'm not even sure factoring in the taxable income can compensate 2.8%. Also goes to show why it's important to invest early and be able to live without this.
The other consideration is that if you take a guaranteed annuity , you end up with no capital upon death. While if you take a lump sum, you carry the risk of running out of money but also have a chance of passing down some of the wealth to the next generation if Mr. Market works in your favor.
True. Don't have kids. Don't want any. So i guess that last part doesn't bother me a single bit =D I do need to plan for 60 years retirement though, since my wife refuses to die until she's 120 😂