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[quote=Anonymous]I looked on the internets, and based on what I found there, I think you should take the pension.  Here's why: If your salary is $100,000, if you put in 25 years of service, you will receive a $41,250 annuity, which is the same as having saved over a million $, but without the worry (okay, some worry that it may just disappear, but the chances of that are much less than the chances of the stock market tanking).

That's more than you would get from the 401k - assuming the generous 8.5 percent employer contribution (is this automatic?) and the same 5 percent contribution that you'd make to the pension plan.  I had this grow at 6 percent, which is either conservative or optimistic depending on who you talk to.  You would end up with about $750,000.

BTW, I didn't see the 401k plan on the internets, so I'm using your info.  
Please let me know if some of my assumptions are incorrect (such as the 401k employer contribution, and I don't understand the 5 percent employee contribution to the defined benefit pension - what happens if a person contributes less?).  I can re-calculate based on other numbers.

Based on the info I have, take the pension.  MOre money, less worry.

Pension	
Assumed Years of Service	25
Multiplier	0.0165
Salary	$100,000
	
Annuity	$41,250
	
Equivalent to savings of	$1,031,250
	
	
401k	
Assumed contributions of 	$5000
Employer contributions	$8500
Total Annual Contributions	$13500
	
Future Value in 25 years @ 6%	$740,671[/quote]

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