[USER]

I’m in my 30s and considering a job that offers a pension plan.

My goal is to retire around 60, but I’m unsure if starting a pension plan now is a good idea.

Given that I haven’t been contributing to a pension for the first decade of my career, does it make sense to rely on this plan to secure my retirement?

I feel as though it contradicts FIRE

Or is it too late to start this journey, and should I focus on other forms of retirement savings?

I’d appreciate any insights or experiences on whether this decision could impact my long-term financial security.

[Lisa]

I started my job with the state at 39. In 2 years I qualify for lifetime health insurance.

And was vested at 5 years on year 8.

[Bob]

Check the vesting. A pension is a defined benefit. There should be a schedule available.

Estimate what your benefit would be at any given length of service.

If that fits into your greater plan considering other revenue streams at FIRE, it might be worth it.

You also have to consider what your 401a is likely to be worth when you’re 59.5.

If you withdraw before that age, you’ll pay a 10% penalty as well as an income tax.

Also estimate the value of the 457.

It doesn’t have the 10% penalty for early withdraw like your 401a.

It’s still income and subject to tax but it could come in handy if you retired before 59.5.

These are defined contribution plans.

Unlike a pension with a defined benefit, your contribution is defined.

Your benefit is how much it grows.

Only you know what your risk tolerance is and how you’ll balance your fund portfolio.

Another thing to consider is if one of those positions offers retirement with health coverage, you’d probably want to know when you qualify.

It may be one of your FIRE factors.

[Nikki]

I love this question. It’s so hard to compare these apples and oranges.
Can you still also contribute to a 401 through this job?

The guaranteed income and dispersing your retirement options is nice.
I am in the same boat kinda.

Trying to decide if I switch back to a non pension position.

However my income for my pension would obviously be stuck at the present amount when deciding future benefit (and there is a break in my pension years already).

[Scott]

Pensions vest after 3-7 years based on the plan. So, you don’t need to put in the 30 years to get it.

Lots of factors to consider though.

[E’Hall]

Do it! You will be vested in less than 30 years, so do it and see how things go.

[Van]

My government pension starts paying out at age 52 after 5 years to be vested.

It also has a COLA and free medical after 20 or 25 years of service.

It works for me.

Even if I FIRE before age 52, it’ll be another source of guaranteed income.

[Laura]

It might not be “RE” to some (although retiring before 65 is in my opinion RE), but it is creating a passive income stream in retirement so it counts in my book.

Husband took a union job around 30-31 for the ben fits including pension.

It’s been a great choice for our fam.

[Rob]

Former teacher here. I was vested in my pension after 5 years & ended up teaching for 10 years before I gave it up.

It’s not a bad idea at all but I would also make it a point to put money into a brokerage account which you can use if you decide to retire early.

If you want to work until 60 then you can still contribute to a 401k & have more in retirement.

I will say that knowing you’re working towards a full pension can feel like a straitjacket if you don’t like the job.

Just something to consider.

[Author]

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