Retirement Income: Pension versus Investments

With a choice between pension retirement income and investment retirement income, I've always chosen investment retirement income.  After reviewing our investment retirement income for the past 6 years, I am relooking at the options again. 

Here are the pros and cons as I consider at the options.

Pension

• Pros - Guaranteed, stable, inflation adjusted.
• Cons -  No control, upside capped

Investment

• Pros - Controlled by retiree, big upside possibility
• Cons - Volatility, big downside possibility, requires management effort

Overall, I don't think there is one right answer for everyone since it depends on personal risk tolerance, interest,  and available time.  For us, I think an blend of pension type retirement income and investment retirement income will be a good approach.  Since neither my spouse nor I have a pension, we will need to consider other options to create stable retirement income streams.

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This is not financial or retirement advice. Please consult a professional advisor.

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