I have to disagree. In this case, the lump sum and the annuity are equivalent if you get a 4.2% return on investment. You aren't going to find a risk-free investment that gets a better return than that, so the only reason to take a lump sum is if you want to invest in riskier investments. The decision comes down to risk tolerance; there is no clear cut winner.
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I have to disagree. In this case, the lump sum and the annuity are equivalent if you get a 4.2% return on investment. You aren't going to find a risk-free investment that gets a better return than that, so the only reason to take a lump sum is if you want to invest in riskier investments. The decision comes down to risk tolerance; there is no clear cut winner.