Making the Most Of Your State Employee Pension


You have given your time and effort to the government for several decades. It is time to reap the benefits of your hard work and dedication. You have a great pension coming, but how do you make the most of your funds?

Here are a few ways to make your pension last.

Your State Employee Pension Plan

The government takes a percentage of your paycheck every pay period. The funds are held aside in a savings account accessed when you retire.

Sometimes, the government matches your contribution with a percentage of its own. Such funding makes the amount available to you even larger.

Lump Sum vs. Monthly Payments

Some retirement recipients choose to have a large payout at the end of their working years, while others opt for monthly payments. There are advantages and disadvantages to both options.

Lump sum payouts are perfect for individuals with a plan for their funds and would stand to lose money as the cost of living rises, and monthly payments remain the same.

Receiving your pension in multiple payouts is ideal for those recipients who do not have long-term financial plans after retirement. Monthly payments for these individuals ensure income and helps them maintain self-control.  


Accepting Monthly Payments

Much can be done with a pension, even if paid monthly. You can save a small percentage of the funds monthly and place it in a high-yielding savings account.

Although you won’t get rich off the interest accrued, you will have something to fall back on in an emergency.

Remember that you will be on a fixed income, and unless you get a second job, there will be no opportunity for overtime. You, therefore, want to ensure that there is a safety net to cover unexpected costs.

Taking the Lump Sum

You can do many things with a large amount of money. You can invest a small percentage of your pension in stocks and bonds and put another portion into a high-yielding savings account.

Many retirees who take their earnings lump sums use the money to start small businesses. It would be best to be careful when using your funds in this manner, as it takes at least two years for a startup to turn over profits.

It is a good idea to start a business with part of your pension and save a large portion of the earnings for a rainy day.

Also, remember that since you took the large payout, there will be no monthly checks from your former employer. It would help if you weighed all the costs before spending your money lavishly.

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  1. My mother-in-law was married to a federal retiree and he had a court order to pay his ex-wife his retirement benefits after he passed. His ex-wife passed. Can’t my mother in-law provide information that the ex-wife is passes and she was married to him for over 30 years and collect his retirement benefits and his insurance?

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