I am 57 years old and my husband is 58. We are not in great shape financially due to a recently failed business venture followed by bankruptcy. We have a net worth of about $75K, mostly in my current employer’s 401K. We owe about $23K in daughter’s student loans at 6.8%, and we still have a home mortgage balance of about $168K.
I’ve just been given a one-time offer by two of my former employers for the following pension options. I have no other pensions other than those mentioned here (and my current employer’s 401K).
Employer A is offering a lump sum of $22,886, or a monthly pension of $203.44 starting at age 65 (with 100% survivor benefit for my husband), or a monthly annuity of $119.89 starting immediately (with 75% survivor benefit).
Employer B is offering a lump sum of $43,194, or a monthly pension of $411.25 at age 65, or an immediate monthly annuity of $236.47 (with 100% survivor benefit).
The lump sums can be rolled into an IRA which will avoid all taxes for now; the monthly annuities will be taxable.
Any idea what I should do?