What is the difference between a lump sum payout and monthly payouts?
A monthly payout is also known as a “life annuity.” Through equal monthly payments, it supplies a steady income. Most people tend to choose this payout method. Having a regular income can be less stressful than taking responsibility for a big lump sum, especially for inexperienced investors. A lump sum payout provides you with the entire balance of your pension at one time. When you take a lump sum, you assume responsibility for how the money will be managed and how much you can spend over time. Experienced investor may be happier with a lump sum which can be invested and potentially grow in value.
