Pension Payment
Hi Terry, I just turned 65 and advised I had to start taking my pension payment at 65. I do not need this money now I’m working to 70. Question is it better to add this money to my 401K through my employer or put the money somewhere else currently I have it sitting in my Savings acct temporarily. The payment is only 503.00 per month. Your advice would be greatly appreciated.
Thank you
Terry Says
OK, that’s a nice and interesting dilemma. I’m assuming that your pension comes from the same employer as your current one that offers a 40l(k) plan — an employer that offers both retirement programs.
If you are still working and qualify based on income, and don’t need the money, I suggest you open a Roth IRA at Fidelity, and invest it conservatively. The money will grow tax-free with no RMDs required. But be sure to ask them to withhold taxes from your monthly payment — or you’ll wind up with a tax bill in April.
