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Reply to "Help me understand my pension numbers"
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[quote=Anonymous]So, most people value assets using the 4% rule which is that you can safely withdraw 4% of your 401k (or whatever nest egg) annually in your retirement. The idea is that if you have a million dollars nest egg, you can see that as 40k "income" per year. You can reverse that to 40k x 25 = 1 million So in your case, if you stuck around to get the 30k income per year, you could multiply that by 25 to get a rough estimate of the "cash value" of your pension. 30k x 25 = equivalent to a 401k with 750k in it. It's just a rough estimate. PP asks good questions about whether your pension adjusts for inflation and is secure (backed by government). I would definitely NOT cash out the pension if you leave the job (at 14 years I assume you are vested). The choice should be in sticking with this job until retirement or in finding a higher earning job and taking the pension at 62. Whether you stay or not, you should probably start funding a Roth IRA on your own as well.[/quote]
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