Pension Advice for Dad
My dad turns 55 later this month, and he's eligible for a small pension from his 10 years of service at a previous employer in the 1980s and 1990s. As I was expecting, they just sent him a lump sum offer along with an offer for starting a reduced pension at age 55.
Would appreciate advice on which option to take. We believe the pension is non-COLA as it does not state anything about a COLA being provided. We think the choice is pretty clear, but just wanted to post in case there's something we may not be thinking about.
Pension lump sum: $37,720 at age 55 (all but roughly $1,500 is taxable so an IRA rollover would be likely if this is chosen).
Monthly benefit starting at age 55 = $190
Monthly benefit starting at age 60 = $369
Dad is semi-retired and currently works part-time as his expenses are low (we're in a LCOL). His health insurance is currently covered by my mom's employer. His part-time job covers his expenses and enables him to continue maxing an IRA each year + contributing to his 401(k) to get the full employer match. He does not need the pension money right now. He is in good health with no known medical issues and exercises regularly.
Our initial thoughts are holding off until he can claim the age 60 benefit. Let us know if we're missing anything though.
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