A defined-benefit pension plan generally offers
the employee two payout choices: Single Life or Joint & Survivor.
Tax law mandates that the automatic payout option is Joint &
Survivor. This option provides as much as 25-50% lower benefits
than a Single Life payout.
The Pension Maximization module is designed
to illustrate the advantage of using a life insurance policy in
lieu of taking the Joint & Survivor pension option.
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Pension Maximization calculates the amount
of life insurance required to replace lost survivor benefits. |
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The calculations factor in cost of living adjustments. |
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Life insurance proceeds are used to fund survivor
benefits. |
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The retiree and spouse can opt for higher monthly
pension amounts. |
