How to maximize your pension
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How to maximize your pension with Life Insurance.
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- 1. How to Maximize Your PensionIf youll be getting a pension in
retirement, you have a lot of decisions to make. One of the most
important is decidingwhether to choose the single life or joint and
survivor option.Single life will give you the most monthly income
for your entire life. But when you die, the income ends. This
optionis therefore usually best only for people who are single,
because if you are married and your spouse outlives you,your spouse
loses the pension income youve been receiving when you die.Thats
why most married people select the joint and survivor option. This
option pays income for as long as you live and keeps paying after
you die, for as long as your spouse lives. But the income you both
get is less than theamount that would have been paid under the
single life option 6% to 25% less.Fortunately, there is a way to
both protect your spouse and retain the higher income. Its called
pensionmaximization. Heres how it works:You purchase an adequate
amount of life insurance coverage on yourself, naming your spouse
asbeneficiary. The death benefit should be enough to replace any
lost pension benefits if you die first.At retirement, you take the
single life option. This way, you receive the maximum pension
benefit for aslong as you live.You then use a portion of the higher
pension income youre receiving to pay the insurance premiums.Call
us to check if this strategy will fit for you.