Interest Rate Impact on Pension Lump Sum

Pension lump sums move opposite to interest rates. See how a 1% change swings your payout.

Lump sum at current rate
If rates rise 1%
If rates fall 1%
Swing per 1% move

Educational estimate only. Real plans use specific segment rates and mortality tables set on fixed dates.

How it works

A pension lump sum is the present value of your future monthly checks. When interest rates rise, each future dollar is discounted harder, so the lump sum shrinks — and when rates fall, it grows. This shows your payout at today's rate and how a one-point move changes it, so you can see whether a rate change helps or hurts.

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