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Parents retiring - online resources?

R

RachelH

Member
One of my parents is close to retiring & has been sent some options by the pension company for annual income and lump sum payments. Can anyone point me to a good spreadsheet online that would let them play around with the options, life expectancy & income they could get on their lump sum? It doesn't look to me as if one option is much better than the other, but they are struggling to make a decision and I think seeing it all laid out on a spreadsheet may help. Thanks all.
 
Professional advice may be best.
Being an actuary (or trainee) does not necessarily mean that one is authorised to provide financial advice.
 
RachelH said:
One of my parents is close to retiring & has been sent some options by the pension company for annual income and lump sum payments. Can anyone point me to a good spreadsheet online that would let them play around with the options, life expectancy & income they could get on their lump sum? It doesn't look to me as if one option is much better than the other, but they are struggling to make a decision and I think seeing it all laid out on a spreadsheet may help. Thanks all.
Click to expand...

You've also got to consider the tax impact. Most people take the lump sum simply because it's tax efficient (you pay income tax on pension received but not on the lump sum, up to a maximum).

The above poster is correct though, they should seek professional advice. I thought that the Government set up either on online or telephone service for this purpose?
 
RachelH said:
One of my parents is close to retiring & has been sent some options by the pension company for annual income and lump sum payments. Can anyone point me to a good spreadsheet online that would let them play around with the options, life expectancy & income they could get on their lump sum? It doesn't look to me as if one option is much better than the other, but they are struggling to make a decision and I think seeing it all laid out on a spreadsheet may help. Thanks all.
Click to expand...

The other key thing to consider is that you should not be considering life expectancy tables at all. The tables are based on the average experience across a large population and therefore are only really appropriate to use if you are looking for average behavior. It is unlikely that your parents will live the average lifetime etc. Make sure they get quotes from loads of companies and don't forget the value in inflation guarantees.
 
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