5 Ways To Increase Your Pension Check
Jan 18, 2023
Blueprint Income Team
To maximize your retirement, you should try to maximize guaranteed income available to you. Here are 4 ways to increase your pension check.
Those with pensions know how valuable they are. And so if you’re one of the lucky few that has a pension, you’ve probably asked yourself the question of how you can increase your pension check. Or, more generally, how can you get more guaranteed monthly income by the time you’re retired.
In this article, I describe 4 paths to increase your pension.
Table of Contents
Increase Your Pension Tip 1: Know and Leverage Your Pension Formula
Most pension benefits are calculated using a formula with three factors:
- The number of years you worked at the company,
- What your salary was while working, especially towards the end, and
- A benefit multiplier.
You typically won’t be able to do anything about #3, but you can surely work on #1 and #2. How does working more hours or working longer affect the benefit you’ll get? Do you have the ability to increase your salary through raises or a promotion that will then translate to a larger pension?
Most pension plans will have tools that you can apply to your specific situation, allowing you to increase your pension check as much as possible. Reach out to your Human Resources department if you aren't already set up with these tools.
Increase Your Pension Tip 2: Lobby Your Employer
Admittedly, this can be an uphill battle, but it’s not impossible. With more employers using the recent tax break to boost 401(k) matching contributions, there’s no reason similar uptick couldn’t be made to your pension.
Increase Your Pension Tip 3: Delay Social Security
Social Security is essentially the government’s pension. You and your employer pay into in the form of payroll taxes, and then you get a check from the government once you retire. You can choose to receive that check as early as age 62 and as late as age 70. The longer you wait, the larger the "pension" check gets (8% higher each year you delay past full retirement age). More here.
Increase Your Pension Tip 4: Buy an Income Annuity
Income annuities generally come in two types — longevity annuities and immediate annuities. Immediate annuities (as the name implies) have income starting within the next 12 months, whereas longevity annuities start income (at a pre-determined level two year or more into the future). Both of these types of income annuities provide the financial security that you get from a guaranteed lifetime income stream that comes each month for as long as you’re alive. They're ways to increase your pension check.
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From there, you'll get access to our annuity guides, team of specialists to help you analyze your retirement finances and walk you through the application process.
So, in short, if you’re looking to increase your pension check by getting more guaranteed lifetime income, you have some options for how to get it. Just keep in mind one thing — the standard 401(k) or IRA isn’t going to provide it.
Blueprint Income Team
We are a team of finance, insurance, and actuarial professionals working to make it easier for everyone to achieve a steady and comfortable retirement. We write about annuities (the good and the bad) and provide strategies to help Americans prepare for retirement.