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figuring out retirement

April 3rd, 2011 at 12:35 pm

I checked my deferred compensation plan, I've passed the $5,000 mark, yippee! I started this plan less than 2 years ago, shortly after I began working full time. No company match, but I still enjoy the tax benefits. I am almost vested at work so I am eligible for a pension one day. I am also entitled to a portion of my exhusband's pension. So it's not like I'm starting from scratch. I just don't know how to quantify pensions because I won't receive a lump sum, only monthly amounts.

How do others determine net worth/retirement savings totals with a pension?

Posted in Retirement | 4 Comments »

4 Responses to “figuring out retirement”

  1. creditcardfree Says:
    April 3rd, 2011 at 02:17 pm 1301840227
    1301840227

    I believe there are retirement calculators that would take into account monthly pension amounts to determine if you are on track for retirement. Not all of them take this into consideration, but I've definitely seen some that do. Maybe a google search?

    My husband will get a monthly pension for life after completing 20 years of active service, but honestly, we don't count that yet. If he left today, it would be zero. So we only look at our retirement savings.

  2. MonkeyMama Says:
    April 3rd, 2011 at 02:19 pm 1301840398
    1301840398

    I don't have a pension, but personally I would treat it like social security. I wouldn't count on it, at all. So much fraud and mismanagement with so many pensions.

    Likewise, you wouldn't include it in your net worth. I think you would just consider the income (along with social security) as a best case scenario when figuring retirement income. It's fair to say you probably won't need as much of a high net worth if you have a pension coming, but a pension is not an asset to add to your net worth - it's a stream of income.

  3. creditcardfree Says:
    April 3rd, 2011 at 02:35 pm 1301841335
    1301841335

    Well said, MM. I also would not exactly count on it.

  4. mamasita Says:
    April 3rd, 2011 at 11:37 pm 1301873847
    1301873847

    Good points. I will definetly look at pension as a stream of income and not consider it part of total net worth. So my Roth IRA, my portion of TSP, deferred comp plan, those would be treated as retirement assets that can be tallied into net worth, while pension is considered income stream much like rental income or paycheck. Thanks for clarification!

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