Question

Pam retires after 28 years of service with her employer. she is 66 years old and has contributed $68,250 to her employer's qualified pension fund. she elects to receive her retirement benefits as an annuity of $6,825 per month for the remainder of her life. click here to access exhibit 4.1 and exhibit 4.2.
a. assume that pam retires in june 2017 and collects six annuity payments this year. what is her income from the annuity payments in the first year?

Answer 1

If Pam retires in June 2017 and collects six annuity payments for the same time period, her income for the year 2017 would be $40,950. Pam would reached her pension fund by the end of 4 months in July.