Shout it out, dragon mom! They need to hear it!
I chose the lowest survivor benefit I could. I think it was 25% so that H would keep the health insurance. It also cost around $200 a month. H did not get the survivor benefit for me as I carry the insurance.
I will leave my wife 100% of my pension. There is a reduction of 12% for that option based on our ages. She is 6 months older than I am.
My wife would lose our healthcare if I died first.
Excuse me if I am sounding ignorant or ill informed but for those of you taking a pension cut with the goal of not losing healthcare benefits for the surviving spouse, are the healthcare benefits all that much better than medicare? Is it enough of a difference that it can’t be offset by taking the extra 12% or whatever and investing/saving it to pay for supplemental insurance to medicare when needed? Just trying to understand the logistics/reasoning. Not lucky enough to have a pension myself.
Good question, doschicos, I’m curious too. I thought that Medicare always was first payer, and wonder what kind of benefits add on to that. Curious about the cost of keeping the supplemental insurance as opposed to paying for it, if it’s better. It seems pretty important if someone is going to retire well before 65, but if they are retiring at 65, is it worth it?
We plan on retiring at 60 (or maybe earlier), and can keep our company insurance, however, we have to pay for it. It is still very reasonable, and good insurance. However, many people convert to the lesser insurance option, for a lower monthly rate, which seems crazy to me, as most people are going to use their medical benefits quite a bit between ages 60-65!
In my pension system retirees over 65 Medicare is the first payer. Our healthcare plan would serve as the gap policy.
So for us if I passed before my wife and she was over 65 she would have Medicare but no gap policy through my retirement plan.
I think it is more of an issue for people retiring much earlier than 63.5 since at 63.5 you could go on Cobra for the 18 months till Medicare
I’m just amazed at how many of you have pensions. My parents both have pensions, but none of my close friends (nor my husband and I) get pensions when they retire. Most of us are working until we are 65.
I’m having trouble finding that older thread about retirement. Have you saved enough for retirement, or something like that. It used to pop up for me on one of the forums, but I never bookmarked it. Can anyone link me?
One thing to remember is not every pension is the same. Both in retirement and during the working years how it is funded by the employee/employer…
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@Midwest67, I just put it on the first page for you.
It’s titled, “How much do YOU think YOU need to retire…”
My first real job was with the federal government. I cashed out my “retirement” when I left after 3 years, so no pension there. My next real job was with a big bank and I stayed 9 1/2 years! But they had 10 year vesting in the pension, so none there either. Subsequent jobs had no pension, so none for me, but fortunately, 401ks rolled into IRA have built up nicely over the years. My wife went back to work in 1997 after 8 years at home and she vested in a pension and quit after 5 years, so she will get a small one, if it remains solvent.
@busdriver11 Thank you so much!
But with Obamacare, its not that hard to get insurance between the ages of early retirement and when medicare kicks in, different than it used to be. Unless you are being offered some cheap, employee rate, Obamacare is likely much cheaper than COBRA coverage.
@NJres Even if you had stayed at the bank longer, the bank might have converted their pension to a 401K. Many companies have gone that route.
I am eligible for retiree medical from my employer. My husband is as well, although his is through his professional union contract, so always subject to negotiations. It covers us from retirement to Medicare eligibility at a fairly reasonable cost - excellent coverage and better than what can be purchased on the market. From what the retirement people said, it can save us as much as $100K, depending on our retirement ages. He will go in ~2 years and I will go out between 2 and 4, depending on a couple of things.
We have defined benefit pensions for most, with transitions to defined contributions this year.
I’ve spent this week on our place on the water. I can see myself here from May to Sepember, health willing. We have family members who spent retirement years over here until illnesses meant getting treatment in a Seattle hospital.
I am able to get UK citizenship by descent, and had thoughts of lots of time overseas until Brexit took that away. Instead, we will do time here, time in Seattle, and other places in the US and abroad to recharge. (Snort)
Taxes are reasonable, politics are my way, no hurricanes or tornadoes, no extreme temps, only occasional earthquakes, and families are here. What’s not to love?
@SnLMom – The requirement that an enmployee can’t waive survivor benefits without spousal consent was part of legislation (REA) passed in 1983.
.http://www.wiserwomen.org/index.php?id=279&page
BTW, this looks like a REALLY useful website for retirement stuff!
This applies to “qualified” retirement plans – pensions, 401(k)s – but NOT IRAs. You can leave your IRA to the anyone without spousal consent.
@HappyFace2018, if you are a federal employee, you’ll be hard pressed to find lower expense ratios than with the 401(k) plan, though Vanguard is probably the best alternative. (DH is a fed – he’ll take the pension w/ survivor benefits, his 401(k) will stay in FERS, and my rollover IRA is at Vanguard).
Busdriver, there are definitely scenarios where waiving the spousal benefit makes sense. I have a tiny pension benefit which DH will probably waive because it barely buys a week’s worth of groceries. Not worth the hassle. For us, DH has most of the pension benefits, and most of our assets are in retirement vehicles, so survivor benefits make sense to protect me, given my health. OTOH, my life expectancy is a mixed bag. It could be a 10% of pension benefit mistake if I am gone not long after he retires – but he will be fine financially anyway.
We are keeping his private term life policy, even though the premiums are getting expensive, until he retires and I can get medicare plus his plan as secondary. If something happened to him before he retires, I will need every penny of that insurance for medical bills.
Thank you @CountingDown 
I agree about the low expense ratios for the federal TSP, but apparently a high percentage of people actually take all funds from the TSP when they are eligible. I plan to leave mine in.
We took a pension from a place H worked for 10 month. It is $74.10 a month.
When I did the math of that for years to come and taking it as a lump the years to come won.
I think the personnel person was annoyed with me <:-P