Category Pensions

Auditor: Ontario fails to protect pension plan members! And Nortel pensioners await resolution 7th year post bankruptcy.

In a nutshell Two private sector pension related bad news stories landed in my inbox in the past week: (1) the Auditor General of Ontario warns that the province (via its monitoring arm the Financial Services Commission of Ontario, the FSCO) does an inadequate job in protecting pension plan members and (2) Nortel pension windup, […]

Annuity/Pension vs. Lump-sum- Part 5: Putting it all together

In a nutshell Putting it altogether, you are now ready to explore your own personal situation for the annuity/pension vs. lump sum decision. If you are reading this Part 5 blog post of the final one of this series, then you have already ploughed through the first four parts: Annuity/Pension vs. Lump-Sum- Part 1: Making […]

Annuity/Pension vs. Lump-Sum- Part 4: Monte Carlo simulation to explore retirement income trade-offs with and without annuitization

In a nutshell In this blog post (Part 4 of this series) we use Monte Carlo simulation to explore the range potential outcomes given assumed Capital Market Expectations, (risk tolerance and corresponding) Asset Allocation, in the context of personal circumstances (Age, Assets, Expenses, Other Lifetime Income sources and the resulting required withdrawal rate) and compare […]

Annuity/Pension vs. Lump-Sum- Part 3: Quantitative considerations

In a nutshell In this blog post (Part 3 in the series), in the context of a specific example for a 67 year old couple, we explore quantitative considerations toward the annuity/pension vs. lump-sum decision, such as: (1) fixed and discretionary expenses, (2) capital market expectations, (3) how/when/if to annuitize, (4) understanding the value delivered […]

Annuity/Pension vs. Lump-Sum- Part 2: Drivers to and away from annuitization

In a nutshell In Part 2 of this series of five blog posts, we approach the annuity/pension vs. lump-sum decision qualitatively to allow individuals to tentatively screen themselves into an annuity or lump-sum direction; in follow-on blog posts we explore quantitatively the decision to annuitize, when it might make sense to do so and how the outcomes […]

Annuity/Pension vs. Lump-Sum- Part 1: Making the right decision for you

In a nutshell In Part 1 of this five part series, the focus is on: (1) risks in retirement, (2) life expectancy and impact on retirement planning age and (3) annuities are insurance not investment The three key risks in retirement are: longevity risk, inflation risk and market risk. Annuities/pensions address some aspect of these risks, while […]

Expanded CPP is dead? Long live pension reform!?!

 In a nutshell The expanded CPP appears dead, for now anyways; this time killed by the federal government. With apparent consensus on the need for pension reform, over the past few years the possibility of an expanded CPP sucked all the oxygen out of the debate on the best type of pension reform for Canada. […]