Les Ismore

A few thoughts:

1. Check to see if being vested in the state plan entitles you to any retiree healthcare benefits. Many governments provide these benefits to pension recipients - even deferred pensioners. The healthcare benefit may be worth more than the pension! If you take your money out, you'll likely forfeit any health benefit.

2. $400/month (guaranteed) at 55 is nothing to sneeze at...even 20 years out. Neither is 4% risk-free return in this market. Most people would love to have a defined pension benefit. Think long and hard before you give it up. I would ask an insurance specialist what a lifetime annuity paying $400/mo starting at 55 would cost you in today's dollars. This will give you a basis for comparison.

3. Are you sure you'll never go back to work for the state? Or another government employer that would accept you state service time credit for vesting purposes? Taking the funds out could cost you with a new DB employer.

Bottomline: I'd take my time and consider everything. Your earning 4% in the meantime which isn't too bad.

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