Many companies nowadays are finding ways to minimize their payroll expenses, from reducing the hourly rate to taking away the number of vacation days awarded to all employees. One thing that won’t go away soon though is retirement benefits. This is mandated by the federal government, so all tenured employees are assured of receiving monthly compensation long after they have left their company. Some enterprising individuals however aren’t waiting for every month to pass before reaping the benefits of their work ; many are now cashing out, choosing to receive a smaller sum over waiting for each month to come and go. But which option is better?
One thing you can do is to check your company’s pension plan and to compare it with other options. You might be surprised to find that better choices have sprung up over the years. If your company permits it, you can transfer your funds to a better plan and earn more interest there.
If you’re not the patient type, you can also choose to get a payout which is one lump sum at the beginning of your retirement years. This option will decrease your overall monetary benefit as interest is calculated back to the present month and year, but at least you will have a larger sum to invest with in better financial instruments should you wish to go down this route.