Pension Maximization

[jwb0007]

Have not seen this subject discussed much/any here. Does anyone have significant experience w/ "PenMax"?

I have considerable understanding of it, however, being a Missouri resident, have had trouble getting enough life insurance (Standard NT) to safely fund a scenario. Typically, the Life Only to 100% J&S reduction might be 9% - 12%(most of the time).

Any thoughts/experience/methods that might be helpful? Anybody find a reversionary annuity that could consistently do the job?

Thanks for your help.

Jim Boyd

 

[DLierMN]

In all the scenaios I have run it only works if the client funds the life insurance early and is in good health. Unfortunately it seems I don't get the call from the agent until the client is 1 month away from retirement and by then they are often too old for the concept to workout.

 

[wfdevereaux]

I own the software on pensionmax com. I have been doing this since 1974. Check out the site and see if it helps you out. We seldom find a case where it will not work. Actuarily certified for accuracy. I also do Fly-In Work shop on the topic, if you are interested in getting a group together.

Have a great day.

 

[arnguy]

I thought the pensionmax scenario went out with high-button shoes. Seriously, is there still a market for that since many companies no longer offer pensions as a benefit?

 

[BNTRS]

I thought the pensionmax scenario went out with high-button shoes. Seriously, is there still a market for that since many companies no longer offer pensions as a benefit?

Absolutely, public school employees being one of the biggest.

Agents who work for a capitive company can pmax themselves as a lot of the big names still offer pensions. A lot of colleges and universities still have pension plans. They exist, though much rarer than they used to be.

I suppose a particularly resourcesfull agent might also try and pmax a 412i

 

[Full Throttle]

I like the "pension max" strategy with non-pension investments to get more income in retirement, with less risk, and without losing the kid's inheritance with a SPIA / life insurance combo (for basic needs). This is part of why I advocate that many of my clients use a small percentage of their savings into a permanent life product. It's not who gets to retirement with the most dollars, it is who gets to retirement with enough income to meet their goals and can enjoy it without following the market each day and worrying about their income.

 

[Full Throttle]

I own the software on pensionmax com. I have been doing this since 1974. Check out the site and see if it helps you out. We seldom find a case where it will not work. Actuarily certified for accuracy.

While SPAM isn't appreciated in the forum, I do like the software and report you put together. What a great way to take a complex scenerio and run them through the "what-if" figures. I saved it as a bookmark in case I need it as a resource.

 

[wfdevereaux]

In the next decade about 1/3 of all Americans will reach retirement age. That is over 100 million people. Many will have accumulated assetts that need to be distributed. Most will annuitize that in one way or another. Whether it is a 401K, Pension, 403b or whatever the decisions are the same. Do I provide for a spouse or not? You will be asked to help in that evaluation process. We owe it to the public to be informed of All of the options that exist. Nothing is perfect and there are no cookie cutter answers that I am aware of, if there are would someone share them with me.
After 35 years in this specialty, I feel that theese can be amongst the most significant decissions a clien will ever make. There are many things to consider and most lack the skills to know how to do that properly.
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For those working in the public sector, take a look at using 457 deferred comp for the administrators to fund a PensionMax plan. There are pros and cons to it, so get some current and good advise in setting them up.

 

[arnguy]

You are right. I was thinking only of the private sector corporate world.

 

[jwb0007]

I own the software on pensionmax com. I have been doing this since 1974. Check out the site and see if it helps you out. We seldom find a case where it will not work. Actuarily certified for accuracy. I also do Fly-In Work shop on the topic, if you are interested in getting a group together.

Have a great day.

So, I come back to my original question (and its underlying assumptions)--how do you get enough life insurance with a 9% - 12% typical reduction, AND have it be sufficient in amount to ensure that a "conservative" return of 4%-5% will at least equal the pension payment to, say, age 95 or 100 or so (because the pension plan will).

Thanks.

Jim Boyd
P.S. Actually, I have come across your software when doing a "pension maximization" search. Is interesting, and I like your attention to the ethics of the process, as so many are so glib--and so incorrect. The example you use shows almost 18% as a reduction . . . .