DEAR BRUCE: My husband recently passed away. Soon I will be receiving his pension. My husband would have turned 65 years old this month; he never collected any of this. I will be 64 years old in October.
My options are to receive $37,000 in one lump sum or to get $221 a month for the rest of my life. My mom is 93 years old, so there is longevity on my side. Which should I choose? — R.R., via email
DEAR R.R.: First of all, if you take the $37,000, you have to invest it quite aggressively in order to give you a higher return. Keep in mind that the principal will become part of your estate. In other words, if you take the lump sum and pass away early, you'll leave a bigger estate. That would be far less important than what is best for you.
It all comes back to what you would do with the money. If you are an aggressive investor, you might want to consider taking the lump sum, but in the absence of that, I would be more comfortable with the lifetime annuity.
DEAR BRUCE: I was wondering how a person goes about buying a share of stock. Who do I contact? — Liz, via email
DEAR LIZ: Do you mean a share of stock or do you mean making an investment in the stock market? If you are buying only a share or two, a broker will tell you what companies allow you to do that. I don't understand why you would buy one or two shares, though, unless it's a gift to a child to encourage him or her to learn how more about the market.
If you are asking how you can invest in the market, you most certainly should contact a broker. When you have to ask such an elementary question, it tells me you're somewhat uninformed about the marketplace. I would encourage you to begin studying the market by reading the business section of your daily newspaper in order to get a better understanding.
Once you know more, I still think you should have a broker on your team. It may be difficult to find such a broker if you are making a very small investment. In that case, go to a discount broker where you call all the shots and pay a very small fee. In this event, it is even more important to get a modest education.