How to Get the Most Out of Your Pension

If you’re expecting a pension when you retire, your decisions on how it’s distributed could have long-term effects on your financial security.

A pair of retirees sit on foldable lawn chairs atop a grassy hill in a pleasant town.
(Image credit: iStockphoto)

For many American workers, a defined benefit pension plan is an artifact that has gone the way of phone booths, cassette tapes and percolator coffee.

But millions of federal and state government workers, teachers, and individuals who work for companies that continue to provide this once-common benefit are still eligible for a pension when they retire. There are even signs that pensions are making a minor comeback. In January, IBM discontinued contributions to its employees’ 401(k) plans and defrosted a defined benefit plan it froze more than 15 years ago. IBM’s move was influenced by favorable market conditions that could compel other companies to thaw out frozen pensions.

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Sandra Block
Senior Editor, Kiplinger's Personal Finance

Block joined Kiplinger in June 2012 from USA Today, where she was a reporter and personal finance columnist for more than 15 years. Prior to that, she worked for the Akron Beacon-Journal and Dow Jones Newswires. In 1993, she was a Knight-Bagehot fellow in economics and business journalism at the Columbia University Graduate School of Journalism. She has a BA in communications from Bethany College in Bethany, W.Va.