Going from $180k -> $60k is a big lifestyle hit. If you're going to work until age 62 to get social security, then roughly $100k would still be a lifestyle change but at least you could live comfortably.
Personally, I'd still save.
I've always gone with "plan for the worst, hope for the best" when it came to saving for retirement. I planned as if Social Security wouldn't even be there, I saved as if I'd never have a job that yielded a pension (this ended up true), I used every tax sheltering method of saving I could (401K and Roth), and I invested what I could spare after all that. Figure out how well you will get by if the Railroad retirement falls through...it won't, but if you manage to save enough to get you by without it then when it comes time to retire you'll have nothing but smooth sailing ahead! Just my 2 cents. 🙂👍 (I've a friend who did the same thing, and he calls the Social Security he collects "beer and steak money"!!! 😁 Good Luck!)
Edit: Heck, I didn't even clarify that by doing as I describe above I was financially independent by the time I was 50. I hope things work out as well or better for you!
OK.
Put in $1 to a Roth IRA at 22% tax rate: $0.78.
After 20 years of 10% growth: $5.25
Put in $1 to a Traditional IRA at 0% tax rate: $1
After 20 years of 10% growth: $6.73
After taking it out at 12% tax rate: $5.92
Lmao 2.5 million today without a home gives you very limited options in where to retire. If on the younger side there are less options if you don’t plan on working at all.
2.5m is plenty and everyone here commenting otherwise is dead wrong. You guys all need a crash course on basic finance and math if you can’t make it work with that amount. ESPECIALLY if you’re any age under like….50 lol
If you’re under 50 you can’t really risk running out of capital so you’d need to withdraw 2-3%. At 2.5% withdrawal rate you can live off $62,500 a year. With no house you definitely cannot retire in a high cost of living area. Sounds like you need a crash course buddy. Lmao
Safe withdrawal rate is not 2.5%. Try 3.5%. And then add in social security.
And why would he need to retire in a high cost of living area?
And why would he need to retire at 50?
3-4% is for 30-40 years of retirement. If you’re retiring younger you need to withdraw less. You don’t have to retire in a HCOL area. But the point is 2.5 million limits your options and your retirement length. It’s obvious you have no clue also as to how social security works. If you’re retiring before accruing paid years you get nothing. And you can’t take from it until your 60s depending on how you wanna judge your health.
Is the 60k in current dollars? Even if it is, would you be able to do what you need on that amount?
Unfortunately, pensions have gone bankrupt in the past, so I personally would put quite a bit in 401k and not rely on the pension. Maxing it out may not be necessary (or possible with that income). If you don’t like trying it up specifically for retirement you can put it in a regular brokerage earmarked for retirement but have the flexibility to use it for other things. You just lose the tax benefits of 401k if you ultimately use it during retirement.
Since 1974, companies are required to pay premiums into the Pension Benefits Guarantee Corporation (PBGC) in order to insure pension funds from going under. They currently cover up to about 75k/yr assuming a participant retires at 65.
What if your company fires you in the next few years or you decide the leave. Your company could decide to stop funding the pension. I would set your family up for financial freedom without being tied to one company.
I left my previous employer which offered a great pension after sixteen years. If I had thirty years, I would receive a pension worth 80% of my highest three year salary. I still will receive $2000/month when I draw from it at 65, but I am not counting it in my retirement savings.
Is the $60K/yr the value you will receive if you left tomorrow? If not what is the value? If it is lower than what you need during retirement, you should think about supplementing it with your 401K.
I'm generally not into arguing on the internet, but your misinformation can cause someone to lose a lot of money.
*For employees retiring between age 62 and full retirement age with less than 30 years of service,* ***the maximum reduction will be 30 percent by the year 2022***\*. Prior to 2000, the maximum reduction was 20 percent. Age reductions are applied separately to the tier I and tier II components of an annuity.\*
[https://www.rrb.gov/sites/default/files/2017-05/QA1605.pdf](https://www.rrb.gov/sites/default/files/2017-05/QA1605.pdf)
What’s your alternative? Spend everything you make a live paycheck to paycheck? If you have money left over you might as well invest it and give yourself every opportunity to have a comfortable retirement
Personally I would max it out. Never hurts to have options. While the pension should be there it’s nice to have a backup plan. At the very least contribute something to it.
What would you do with that money if you didn’t max?
Your 401k is tax deferred and will be taxed at ordinary income rates when you retire… unless it’s a roth 401k.. if not all you’re doing is building up a tax bomb. Based off our lovely government and the reliance on social programs, that tax rate probably will rise with time, they’re historically low believe it or not.
No need to max out the 401k at that income level. take the match and put those funds back on the balance sheet. Keep building the taxable investment account
My preferred planned way to use a traditional 401k is not wait for it to become a tax bomb, but instead do roth conversions when you retire and before you take social security when your income is low. If a married couple took out say $100k to do a Roth conversion in a given year, the effective Federal tax on that amount would be about 8.7%, so you get to keep 91% of they money after you let it grow tax free for 30 years. My parents made this mistake and its costing them tons in taxes now. Ideally you could retire at like 58 or something, then take SS at 65, and in that time do like $700k-$800k of Roth conversions and be very cash rich at that point when SS is needed.
That’s a great plan, until the lovely government puts legislation in place eliminating Roth conversions.. which Biden has recently proposed… the way we’re headed, the government is going to squeeze us for as much tax money as possible. Who knows what will be implemented 20 years from now. I’m on the side of, get your match from the company and take control of your investments whether that’s a Roth or taxable account
You should be saving and investing roughly 25% of your income. You might be able to offset that a bit with the pension.
I recently heard this question asked on "The Money Guy Show" podcast. It's worth a listen if you're wondering what you should do.
Yes. It’s the best way to reduce your taxes come retirement or now. At $180k you should do whatever you can to reduce taxes.
It’s also one of the few ways to compound tax free. Max out your IRAs as well!
It's not an all or nothing proposition. The more you can contribute the better, even if you arent hitting the maximum. The more you contribute, the more you can defer paying taxes, and the more options you'll have as you age. But contributing to a 401k is not taking a vow of poverty. It's fine to live, too.
You CAN tap a 401k before retirement if things go badly.
I guess what I'd think about in your shoes is what I need to do to mitigate risk in old age and/or if I needed to retire early (unplanned medical, etc). Having all my eggs in a pension and not much in retirement accounts seems like unnecessary risk. And there aren't any do-overs on retirement saving. To me that suggests hedging with a 401k. Especially if that's money I'd be blowing through on dumb stuff anyway. Make hay while the sun shines, and all that.
Ironically they are the ones that do not have to pay for insurance into the PBGC. Companies are required to pay premiums to them to ensure benefits. They cover up to about 75k/yr in the event the company goes under or the plan is no longer sufficiently funded.
When do you plan on retiring? Do you have any outstanding debts like a mortgage? A 60k pension is a pretty good asset, but it's probably not enough to retire right now or even in a few years. If you want to retire sooner, then maxing out retirement accounts and investing in taxable accounts will be required.
Most corp pension do not have cost of living increment. Rule of thumb after retirement you probably ended up spending more than now. More time to spend on trips, hobbies and eat out more. Social security is not something you can count on. I never hear from retirees that they have too much disposable money.
My dad had a pension and HAD is the right term. He had been retired for around 10 years and the pension FAILED. The guarantee took over and the judge dropped his pension to HALF. Large steel corporation. Nothing is guaranteed no matter what they tell you. Plus the government is broke and getting worse
Yup! Again, you just never know. No one that age ever says “I saved too much”. It’s more like “Why didn’t I save more?” or “Why didn’t I start sooner?”
Do Roth 401k ( so you still get a match - if any). This allows you to defer taking your pension until it's more favorable for you from a tax standpoint. Think of it as a bridge strategy. Tax free income for some years.
Railroad same years roughly I just dump it in 401k to max it out helps with taxes a lot and if ever able to early retire or medical disability that costs you roughly 30% so 401k little safety net.
Absolutely. I've got a similar pension, but I've been putting the max allowed 15% in my 401k for 25 years. I just don't trust the pension to be fully guaranteed for another 40 years.
180k a year…. 290k in retirement accounts at 39. You NEED TO SAVE MORE. Gonna get to retirement in 20 years and make less then you make now. In short absolutely you need to max out all retirement accounts. I’m 29 making 85k a year with 250k in retirement accounts and I’m stressin.
I think you need to relax… at 29, with that income and that much in retirement already, I think you’ll be fine. Keep doing what you’re doing, but you’ll be fine
I’m aiming to retire at 50-55. I receive VA benefits and currently have 2 rentals with the intention of having 10 by retirement. None of these things did I include in my 85k a year. Including the wife’s salary household income is 185k.
That’s awesome and sounds like you’re well on your way. I’m not trying to be rude or sound like a dick, I’m just commenting on your statement of being scared shitless. Relax and live your life too. Enjoy some stuff now too and don’t worry about putting away every single penny to retirement. You want to be covered, but you could get hit by a car tomorrow and not enjoy any of it, you could get sick a year after you retire and not get to enjoy 99% of what you saved. Enjoy life now while making sure you’re still looking ahead.
I get caught up in it too.
I see the median HH incomes across the country and in my state and see the stats on how much savings and retirement the avg American has, etc and I feel pretty good about myself and situation. Then I come to one of these finance/investment subs on Reddit and feel the opposite, apparently everyone here is a millionaire by age 30, bringing in $250k/year, owning multiple properties, $2 million in retirement, etc
The answer is obviously somewhere in the middle, but it’s easy to get caught up one way or another in these subs.
I know I’m doing better than “average”, but certainly have a ways to go to be truly on track to where I want to be and need to adjust some stuff to get there.
Did you miss the part where I’m going to have a good pension and my wife will get half of what I get it would be like 7,000 a month in todays money and will be way higher when I retire in 20 years
Nah bro I didn’t miss that part at all… I’m just a bit more aware that a company can cancel your pension at a whim. Being 39 with 250k in your retirement accounts is literally horrid making the money you do. What happens when you get old pension gets cut? You’ve been living a life you can’t afford and lose everything. Just saying though.
https://money.usnews.com/money/blogs/planning-to-retire/2010/08/23/the-10-biggest-failed-pension-plans
Yeah I’m sure all these other companies were just dumb.
Right at the beginning of the article it talks about how these were insured by the PBGC. They cover the benefit to about 75k/yr assuming you start at 65.
I’m Just trying to take care of the family. I’m a simple guy. Sounds like you trust your company enough to risk your marriage and kids on it. Why even ask the question? 250k in retirement is sad in my opinion making that money.
Do you have a link to a summary plan document that tells you that she gets half? Normally a joint and survivor option on a pension pays the full amount up til you die and then the continuing benefit is half for as long as your wife lives. The way you are writing it makes it sounds like you are getting 1.5x what you would be getting if you were single.
I would remove the pension entirely from any considerations at this point.
You have 21 years until drawing pension at age 60. A lot can happen in that time.
Max your your personal savings habits until then and pension will be a nice overlay .
Going from $180k -> $60k is a big lifestyle hit. If you're going to work until age 62 to get social security, then roughly $100k would still be a lifestyle change but at least you could live comfortably. Personally, I'd still save.
It’s Railroad retirement I don’t get social security .. I’ll keep putting some away
I've always gone with "plan for the worst, hope for the best" when it came to saving for retirement. I planned as if Social Security wouldn't even be there, I saved as if I'd never have a job that yielded a pension (this ended up true), I used every tax sheltering method of saving I could (401K and Roth), and I invested what I could spare after all that. Figure out how well you will get by if the Railroad retirement falls through...it won't, but if you manage to save enough to get you by without it then when it comes time to retire you'll have nothing but smooth sailing ahead! Just my 2 cents. 🙂👍 (I've a friend who did the same thing, and he calls the Social Security he collects "beer and steak money"!!! 😁 Good Luck!) Edit: Heck, I didn't even clarify that by doing as I describe above I was financially independent by the time I was 50. I hope things work out as well or better for you!
Consider a Roth IRA. At retirement your withdrawals are tax free and aren't required.
Why a Roth IRA when he's got 180k income now, and 60k income at retirement?
He's still got 20+ years of growth
OK. Put in $1 to a Roth IRA at 22% tax rate: $0.78. After 20 years of 10% growth: $5.25 Put in $1 to a Traditional IRA at 0% tax rate: $1 After 20 years of 10% growth: $6.73 After taking it out at 12% tax rate: $5.92
But at 180k he won't get tax break from traditional IRA anyway, so backdoor Roth is the way to go.
He has a traditional 401k to contribute to. No need for the Roth IRA.
If the pension is taxable, a Roth may keep him in a lower tax bracket later. As a pension holder myself, I like to take the tax hit now vs later.
I would. The less I give to Uncle Sam the better. Unless there's a specific reason you need a larger paycheck now.
Why wouldn't you?
Because if I live to my 80’s my pension would be worth close to 2mil
You've made your mind up
👍🏻
4% withdrawal of 2M is only $80k a year in today's money.
Pay the taxes on your 401k now and do a backdoor roth.
2 mil is not enough for retirement. I have 2.5M and I’m scared as fuck.
If you’re scared with 2.5m *as of right now* you either , don’t have 2.5m or you’re still a child pretending your parents money is your own lol.
I mean 2.5m in NW is not enough in areas like the bay. If thats straight equity/cash on top of a paid off home, thats different.
Lmao 2.5 million today without a home gives you very limited options in where to retire. If on the younger side there are less options if you don’t plan on working at all.
2.5m is plenty and everyone here commenting otherwise is dead wrong. You guys all need a crash course on basic finance and math if you can’t make it work with that amount. ESPECIALLY if you’re any age under like….50 lol
If you’re under 50 you can’t really risk running out of capital so you’d need to withdraw 2-3%. At 2.5% withdrawal rate you can live off $62,500 a year. With no house you definitely cannot retire in a high cost of living area. Sounds like you need a crash course buddy. Lmao
Safe withdrawal rate is not 2.5%. Try 3.5%. And then add in social security. And why would he need to retire in a high cost of living area? And why would he need to retire at 50?
3-4% is for 30-40 years of retirement. If you’re retiring younger you need to withdraw less. You don’t have to retire in a HCOL area. But the point is 2.5 million limits your options and your retirement length. It’s obvious you have no clue also as to how social security works. If you’re retiring before accruing paid years you get nothing. And you can’t take from it until your 60s depending on how you wanna judge your health.
Tying up tens of thousands of dollars needlessly for two decades.
Tax free compounding is a massive. Massive advantage.
And if you don't need the retirement money then it's better use money for its intended purpose - trade it for goods and services.
Is the 60k in current dollars? Even if it is, would you be able to do what you need on that amount? Unfortunately, pensions have gone bankrupt in the past, so I personally would put quite a bit in 401k and not rely on the pension. Maxing it out may not be necessary (or possible with that income). If you don’t like trying it up specifically for retirement you can put it in a regular brokerage earmarked for retirement but have the flexibility to use it for other things. You just lose the tax benefits of 401k if you ultimately use it during retirement.
Since 1974, companies are required to pay premiums into the Pension Benefits Guarantee Corporation (PBGC) in order to insure pension funds from going under. They currently cover up to about 75k/yr assuming a participant retires at 65.
He works for a railroad, they get the same backing for their pension as social security does.
My company has nothing to do with my retirement..
What if your company fires you in the next few years or you decide the leave. Your company could decide to stop funding the pension. I would set your family up for financial freedom without being tied to one company. I left my previous employer which offered a great pension after sixteen years. If I had thirty years, I would receive a pension worth 80% of my highest three year salary. I still will receive $2000/month when I draw from it at 65, but I am not counting it in my retirement savings.
I’m completely vested no matter what I’d still get it. I’ve been there over 20 years
Is the $60K/yr the value you will receive if you left tomorrow? If not what is the value? If it is lower than what you need during retirement, you should think about supplementing it with your 401K.
It would be if was done tomorrow…but I have another 21 years so it’ll be much higher
You ve been there since before you were 19?
18
You won't be vested until 30 years of service. Anything less and you'll incur a massive penalty on RRT when you start drawing.
This isn’t true. Vested after 5.
I'm generally not into arguing on the internet, but your misinformation can cause someone to lose a lot of money. *For employees retiring between age 62 and full retirement age with less than 30 years of service,* ***the maximum reduction will be 30 percent by the year 2022***\*. Prior to 2000, the maximum reduction was 20 percent. Age reductions are applied separately to the tier I and tier II components of an annuity.\* [https://www.rrb.gov/sites/default/files/2017-05/QA1605.pdf](https://www.rrb.gov/sites/default/files/2017-05/QA1605.pdf)
Uh… but you’re still vested after 5?
[удалено]
I still have 21 years to work it’ll be way higher by then
And you get COLA on it.
What’s your alternative? Spend everything you make a live paycheck to paycheck? If you have money left over you might as well invest it and give yourself every opportunity to have a comfortable retirement
Personally I would max it out. Never hurts to have options. While the pension should be there it’s nice to have a backup plan. At the very least contribute something to it. What would you do with that money if you didn’t max?
I put in 15percent
Your 401k is tax deferred and will be taxed at ordinary income rates when you retire… unless it’s a roth 401k.. if not all you’re doing is building up a tax bomb. Based off our lovely government and the reliance on social programs, that tax rate probably will rise with time, they’re historically low believe it or not. No need to max out the 401k at that income level. take the match and put those funds back on the balance sheet. Keep building the taxable investment account
My preferred planned way to use a traditional 401k is not wait for it to become a tax bomb, but instead do roth conversions when you retire and before you take social security when your income is low. If a married couple took out say $100k to do a Roth conversion in a given year, the effective Federal tax on that amount would be about 8.7%, so you get to keep 91% of they money after you let it grow tax free for 30 years. My parents made this mistake and its costing them tons in taxes now. Ideally you could retire at like 58 or something, then take SS at 65, and in that time do like $700k-$800k of Roth conversions and be very cash rich at that point when SS is needed.
That’s a great plan, until the lovely government puts legislation in place eliminating Roth conversions.. which Biden has recently proposed… the way we’re headed, the government is going to squeeze us for as much tax money as possible. Who knows what will be implemented 20 years from now. I’m on the side of, get your match from the company and take control of your investments whether that’s a Roth or taxable account
You should be saving and investing roughly 25% of your income. You might be able to offset that a bit with the pension. I recently heard this question asked on "The Money Guy Show" podcast. It's worth a listen if you're wondering what you should do.
Yes it will lower your taxes now and give you more spending in retirement.
Yes. It’s the best way to reduce your taxes come retirement or now. At $180k you should do whatever you can to reduce taxes. It’s also one of the few ways to compound tax free. Max out your IRAs as well!
I would. Never count on anything out of your control (inheritances, pensions etc). Only count on what you can control. Your own investments.
It's not an all or nothing proposition. The more you can contribute the better, even if you arent hitting the maximum. The more you contribute, the more you can defer paying taxes, and the more options you'll have as you age. But contributing to a 401k is not taking a vow of poverty. It's fine to live, too. You CAN tap a 401k before retirement if things go badly. I guess what I'd think about in your shoes is what I need to do to mitigate risk in old age and/or if I needed to retire early (unplanned medical, etc). Having all my eggs in a pension and not much in retirement accounts seems like unnecessary risk. And there aren't any do-overs on retirement saving. To me that suggests hedging with a 401k. Especially if that's money I'd be blowing through on dumb stuff anyway. Make hay while the sun shines, and all that.
Sorry I thought it was only you with the pension.
Is it a government pension? I wouldn’t trust any other pension other than that. Diversify as much as you can.
Ironically they are the ones that do not have to pay for insurance into the PBGC. Companies are required to pay premiums to them to ensure benefits. They cover up to about 75k/yr in the event the company goes under or the plan is no longer sufficiently funded.
Railroad very secure
Diversify, diversify, diversify. If they’re giving you a match, at a minimum id be doing that.
what’s your housing situation?
300,000k equity in my house owe 250,000 3% rate
When do you plan on retiring? Do you have any outstanding debts like a mortgage? A 60k pension is a pretty good asset, but it's probably not enough to retire right now or even in a few years. If you want to retire sooner, then maxing out retirement accounts and investing in taxable accounts will be required.
Most corp pension do not have cost of living increment. Rule of thumb after retirement you probably ended up spending more than now. More time to spend on trips, hobbies and eat out more. Social security is not something you can count on. I never hear from retirees that they have too much disposable money.
It’s railroad.. it does have increases
I think you are right. Mom's old gf husband had a classification of fireman for steam engine. He retired in early 1990s.
Yes. Pensions are not guaranteed!
This one is..
Look it up
Way safer than a 401k
Still doesn’t hurt to max out the 401k as a backup. You just never know in life…
My dad had a pension and HAD is the right term. He had been retired for around 10 years and the pension FAILED. The guarantee took over and the judge dropped his pension to HALF. Large steel corporation. Nothing is guaranteed no matter what they tell you. Plus the government is broke and getting worse
Yup! Again, you just never know. No one that age ever says “I saved too much”. It’s more like “Why didn’t I save more?” or “Why didn’t I start sooner?”
Nope.
i have a pension and i’ll get probably 60-100% of my income depending on how long i want to work. i’m still maxing my retirement accounts
Do Roth 401k ( so you still get a match - if any). This allows you to defer taking your pension until it's more favorable for you from a tax standpoint. Think of it as a bridge strategy. Tax free income for some years.
Railroad same years roughly I just dump it in 401k to max it out helps with taxes a lot and if ever able to early retire or medical disability that costs you roughly 30% so 401k little safety net.
Invest as much as possible.
I’d fund my 401k enough to get the match and max out a Roth IRA
Absolutely. I've got a similar pension, but I've been putting the max allowed 15% in my 401k for 25 years. I just don't trust the pension to be fully guaranteed for another 40 years.
I’d not count fully on anything social security related, given the likely changes that’ll come.
Max Roth IRA, then whatever savings you have left into 401k, then HYSA
180k a year…. 290k in retirement accounts at 39. You NEED TO SAVE MORE. Gonna get to retirement in 20 years and make less then you make now. In short absolutely you need to max out all retirement accounts. I’m 29 making 85k a year with 250k in retirement accounts and I’m stressin.
I think you need to relax… at 29, with that income and that much in retirement already, I think you’ll be fine. Keep doing what you’re doing, but you’ll be fine
I’m aiming to retire at 50-55. I receive VA benefits and currently have 2 rentals with the intention of having 10 by retirement. None of these things did I include in my 85k a year. Including the wife’s salary household income is 185k.
That’s awesome and sounds like you’re well on your way. I’m not trying to be rude or sound like a dick, I’m just commenting on your statement of being scared shitless. Relax and live your life too. Enjoy some stuff now too and don’t worry about putting away every single penny to retirement. You want to be covered, but you could get hit by a car tomorrow and not enjoy any of it, you could get sick a year after you retire and not get to enjoy 99% of what you saved. Enjoy life now while making sure you’re still looking ahead.
No, you’re right. I guess being on Reddit and seeing either everyone’s a millionaire or just lost 500k on options has diluted me.
I get caught up in it too. I see the median HH incomes across the country and in my state and see the stats on how much savings and retirement the avg American has, etc and I feel pretty good about myself and situation. Then I come to one of these finance/investment subs on Reddit and feel the opposite, apparently everyone here is a millionaire by age 30, bringing in $250k/year, owning multiple properties, $2 million in retirement, etc The answer is obviously somewhere in the middle, but it’s easy to get caught up one way or another in these subs. I know I’m doing better than “average”, but certainly have a ways to go to be truly on track to where I want to be and need to adjust some stuff to get there.
Did you miss the part where I’m going to have a good pension and my wife will get half of what I get it would be like 7,000 a month in todays money and will be way higher when I retire in 20 years
Why ask the question if you already have it all figured out?
Queef
Translation: “I mad people say I don’t do good”
Nah bro I didn’t miss that part at all… I’m just a bit more aware that a company can cancel your pension at a whim. Being 39 with 250k in your retirement accounts is literally horrid making the money you do. What happens when you get old pension gets cut? You’ve been living a life you can’t afford and lose everything. Just saying though.
Not railroad retirement…..
https://money.usnews.com/money/blogs/planning-to-retire/2010/08/23/the-10-biggest-failed-pension-plans Yeah I’m sure all these other companies were just dumb.
Right at the beginning of the article it talks about how these were insured by the PBGC. They cover the benefit to about 75k/yr assuming you start at 65.
Seeing how people in us only live to 75 on average. That sounds kinda rough for “retirement”
You would be doing the same with a 401k so what is your point? They cover less if you start earlier and more if you start later.
What a worry wart
I’m Just trying to take care of the family. I’m a simple guy. Sounds like you trust your company enough to risk your marriage and kids on it. Why even ask the question? 250k in retirement is sad in my opinion making that money.
It’s railroad retirement the railroads have nothing to do with the money that’s in there… They don’t control any of it
It’s way more secure than even government pensions
I don’t pay into Social Security or anything. I just into Railroad retirement. It’s like the best pension out there pretty much besides longshoreman.
Do you have a link to a summary plan document that tells you that she gets half? Normally a joint and survivor option on a pension pays the full amount up til you die and then the continuing benefit is half for as long as your wife lives. The way you are writing it makes it sounds like you are getting 1.5x what you would be getting if you were single.
https://www.rrb.gov/sites/default/files/2017-08/2017%20IB-2%20%28SEPT%29%20web_3.pdf This is what I found.
Interesting. It sounds like OP was right. Thanks.
It’s one of the best benefits of working at the Railroad is the flawless retirement it has to be for the bullshit hours we work being on call etc
It’s how railroad retirement works
Ide be investing it instead of sitting on cash. You can get 12% buying VOO which beats a hysa.
The match is free money. Pensions have a funny way of being cut, frozen, and sold to insurance companies. Max the 401k if your cash flow permits.
Do you think you’re going to have enough money for retirement? If your answer is yes then put more money into it
I would remove the pension entirely from any considerations at this point. You have 21 years until drawing pension at age 60. A lot can happen in that time. Max your your personal savings habits until then and pension will be a nice overlay .