My Pension Secure
What is My Pension Secure?
My Pension Secure is a financial planning strategy designed to provide guaranteed, tax-free monthly income to the surviving spouse of a public pensioner while maximizing monthly income for the public employee/pensioner during retirement*.
Many public-sector retirement plans are defined contribution plans, which are not guaranteed. Future benefits may depend on investment performance and/or legislative approval. These factors introduce significant risk.
My Pension Secure provides guaranteed monthly benefits that are tax-free. Traditional public pensions are not guaranteed, and their income is taxable at the federal level and, in many cases, at the state level as well.
Protection Against Inflation and Loss of Purchasing Power
Not all public-entity pensions include an annual Cost-of-Living Adjustment (COLA). In some cases, there is no COLA at all, or adjustments are limited and subject to legislative approval. This erosion of purchasing power can place both the surviving spouse in a serious financial position.
My Pension Secure helps replace this inevitable loss of purchasing power, ensuring the surviving spouse maintains financial stability throughout retirement.
Planning for the Widow(er)'s Penalty
My Pension Secure also helps address the Widow(er)'s Penalty. After the death of the first spouse, the surviving spouse often faces a significant tax increase. This occurs because one standard deduction is lost, resulting in higher taxable income when filing federal tax returns the following year. My Pension Secure will help restore that offset.
How My Pension Secure Works
My Pension Secure is powered by a strategically designed life insurance policy that can be used to:
- Maximize monthly retirement income for the public pensioner
- Offset the loss of purchasing power caused by inflation, particularly for public pensions with no or limited COLA provisions
- Help mitigate the financial impact of the Widow(er)'s Penalty
* The maximizing of monthly retirement income is the result of the public pensioner choosing the highest monthly income by choosing the no survivorship option for the pension then purchasing sufficient life insurance (on his or her life) to replace part or all of the survivor benefit that his or her spouse would have received if the joint and survivor option had been elected. The plan participant will need to be insurable to qualify for the life insurance.