Your spouse and your pension


Q. I can start taking a pension in two years at age 62. I can make it so that my husband will continue to get the benefit if I die first, but then we take a lower benefit. He already has a pension and we don’t really need the money. How can we decide?
— Planning

A. It’s tough to decide when to start taking a pension. The choice to take a full payment or take an option that will give a surviving spouse a monthly payment when you’re gone could make a big difference for your bottom line.

There are several variables to consider when making this election.

First, the age of both spouses and both of your health conditions matter, said Jody D’Agostini, a certified financial planner with AXA Advisors/The Falcon Financial Group in Morristown.

You should also look at your parents, and consider the length of their lives.

“If they lived long lives, and you are both healthy, then chances are you could live into your 90s or beyond,” D’Agostini said. “Often the election to take the reduced amount begins at 75 percent of the full amount and that allows the payment to continue to your spouse if you pass away before him.”

Generally, it is a good decision, she said. If you do not need the money for cash flow, you can always save it to pass onto your children, charity, or to pay for unforeseen medical expenses should they occur later in life, D’Agostini said.

To decide, she recommends you start by looking at both your fixed and discretionary monthly expenses.

“Fixed expenses would be your basic food, clothing, shelter, internet and your auto expenses,” she said. “It is nice to have those paid by fixed sources such as Social Security, pensions and annuities.”

You didn’t say what choice your husband made for his pension, but whether or not it will continue if he dies first needs to be considered.

“I would start by creating a monthly budget, then see which expenses might go away if he passes away first,” she said. “Then look to see what your cash flow would look like.”

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This post was first published in December 2016. presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.