If you’re nearing retirement, you’ll soon be making crucial decisions that will affect how you receive income from your pension. Pension maximization from SEFCU offers a viable way to make the most of your pension by combining the advantages of life insurance and annuities. Call the SEFCU insurance professionals today at 518-786-9905 or 888-250-6689 (outside the 518 area code), or e-mail agent@sefcuinsuranceagency.com, to learn more about this important savings strategy.

What Does Pension Maximization Do?

If you’re married at retirement, you’re likely to be faced with the “pension dilemma”:

OPTION A: Single life annuity.
Receive your entire pension as income for as long as you live. This would mean greater income but a loss of benefits for your spouse in the event of your death.

OPTION B: Joint and survivor annuity. 
Get lower income payments but continuing benefits for your spouse in the event of your death.

Pension maximization employs both life insurance and your annuity so you and your spouse can maximize the potential income benefits as long as you both live. Here’s how it works:

Step 1: Before retirement, you purchase a sufficient amount of life insurance on yourself for the death benefit to replace lost pension benefits if you die first.

Step 2: At retirement, you opt to take the single-life benefit annuity option — receiving maximum income from your pension.

Step 3: Use the additional income you receive from that option to pay your life insurance premiums.

In the event of your death, the tax-free proceeds from the life insurance policy can be used to purchase a new annuity. And since the survivor is now older, he or she will receive a higher income from the same capital.

As with any long-term strategy, it’s important to talk to your financial and tax advisors about benefits and tax consequences. So call SEFCU today – and make the most of your hard-earned income later on.