5 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 5 paths to increase your pension.
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: Set Up a Personal Pension
The Personal Pension is the next best thing to an employer pension and is a way for you to get a pension without your employer. Instead of being provided by employers, it’s backed by insurers, like an annuity. But, unlike the average annuity, you can purchase it in small amounts over time. Blueprint Income offers a Personal Pension account with the lowest minimum, $5,000. After opening an account, you can make subsequent contributions of as little as $100, each of which will increase your pension check.
Click below to see what annual contributions into a Personal Pension will guarantee you in annuity retirement income. After just a few years in retirement, you’ll have recouped your initial investment, and the rest will be profit. A $5,000 contribution is necessary to start an account.
From there, you can fill out the information to have one of our specialists follow up with you, or continue with the enrollment process on your own. To do that, start with the Personal Pension Builder, where you’ll be able to set a goal for how to grow your pension over time. Note that all future contributions are optional, but it’s always great to have a goal.
Increase Your Pension Tip 5: 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.
At Blueprint Income, we offer annuities from more than 15 top rated insurance companies. Click below to get real-time personalized quotes, where you can compare options offered from different insurers on an apples-to-apples basis.
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.
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