• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Unsworth LaPlante, PLLC

Vermont Estate Planning Attorneys

Vermont: (802) 879-7133

Attend A Free Webinar
  • Home
  • Our Firm
    • About Our Firm
    • Meet Our Team
    • What to Expect When Working with Us
  • Services
    • Estate Planning
    • Incapacity Planning
    • IRA & Retirement Planning
    • Legacy Planning
    • LGBTQ Estate Planning
    • Medicaid Planning & Elder Law
    • Pet Planning
    • Special Needs Planning
    • Young Families Planning
  • Resources
    • Articles
    • Elder Law Reports
    • Elder Law Resources
      • Burlington
      • Montpelier
      • Rutland
      • St. Johnsbury
      • White River Junction
    • Estate And Gift Tax Figures
    • Free Estate Planning Worksheet
    • Frequently Asked Questions
      • Estate and Gift Tax
      • Estate Planning
      • FAQs for Families Without an Estate Plan
      • Incapacity Planning
      • IRA & Retirement Planning
      • Legacy Wealth Planning
      • LGBTQ Estate Planning
      • Medicaid
      • Pet Planning
      • Special Needs Planning
      • Trust Administration
      • Trusts
      • Wills
    • Is Your Estate Plan Outdated?
    • Medicaid Resources
      • Medicaid Analysis Worksheet
      • Medicaid Guide
      • Vermont Medicaid
    • Newsletters
    • Presentations
    • Reports
      • Advanced Estate Planning
      • Basic Estate Planning
      • Estate Planning for Niches
    • SECURE Act
    • Top Estate Planning Techniques
  • Webinars
  • Reviews
    • Our Reviews
    • Review Us
  • BLOG
  • Contact
Home » Think Twice Before Taking a Pension Advance

Think Twice Before Taking a Pension Advance

July 2, 2013 by Stephen Unsworth

Have you been tempted to take a pension advance loan?  There are such things after all. Here’s how they work: You get a lump sum payment and pay the lender back over time, usually five or ten years.  You get the money you need now, but at a price. No company is going to give you money as a favor and they need to be repaid, not unlike other lenders.

There are limits on the amount of interest that can be charged, but additional fees can quickly increase your monthly payments. In addition to processing fees, many loans require you to also purchase life insurance in the amount of the loan. The policy is payable to the lender. They take precautions to protect themselves. Who protects your interests?

You as a consumer have little protection in this transaction. With the added fees and the mandatory insurance, effective interest rates frequently top 30 % per year. There is also little oversight over these lenders. Many firms claim that pension advances are not loans, so state banking disclosure rules need not apply to their products. Some states are in the process of investigating firms for a variety of possible violations. Charges range from violation of usury laws (charging too high an interest rate), fraud and deceptive advertising.

You have a vision of what you want your retirement to look and feel like. During your working life, it was always possible to overcome a temporary cash flow problem. You could work more hours or make a big sale to get better commissions. You could take on a side job. Those options aren’t real for most retirees. Before you take a pension advance, ask yourself,” Will I be able to get by on what I get now minus the amount of the loan payment?”

               

  • Author
  • Recent Posts
Stephen Unsworth
Stephen Unsworth
Stephen A. Unsworth is admitted to practice in both Vermont and Maine, and has more than 30 years of experience in estate planning and business law. His mission is to provide quality estate planning services, including assistance with Living Trusts, Wills, Medicaid Planning, Probate, Trust Administration, Powers of Attorney, Special Needs Planning, and Family Limited Partnerships.
Stephen Unsworth
Latest posts by Stephen Unsworth (see all)
  • Business Succession Planning May Be Easier than You Think - May 26, 2022
  • The Toll of Serving as Fiduciary - May 24, 2022
  • Why Do I Need an Advance Directive? - May 19, 2022

Filed Under: General Tagged With: asset protection, pension advance

Other Articles You May Find Useful

Essex Junction estate planning attorney
Why Do I Need an Advance Directive?
Essex Junction probate attorneys
What Assets Avoid Probate?
Essex Junction estate planning attorney
What Should Be Included in My Estate Plan?
Essex Junction trust administration attorneys
Can a Trustee Be Fired?
Essex Junction estate planning attorney
Veterans Aid and Attendance Benefits – What You Should Know
Essex Junction trust attorneys
Common Trusts Explained

Primary Sidebar

Elder Law and Medicaid Planning Attorneys

Unsworth LaPlante, PLC

DOWNLOAD OUR FREE ESTATE PLANNING WORKSHEET

There's a lot that goes into setting up a comprehensive estate plan, but with our FREE worksheet, you'll be one step closer to getting yourself and your family on the path to a secure and happy future.
  • This field is for validation purposes and should be left unchanged.

Follow Us

  • Facebook
  • LinkedIn
  • Twitter
  • YouTube

Blog Subscription

  • This field is for validation purposes and should be left unchanged.

Essex Junction, VT

26 Railroad Ave
Essex Junction, VT 05452
United States (US)
Phone: (802) 879-7133
Fax: (802) 879-0408

Map

unsworth_sidbr_map

Office Hours

Monday8:00 AM - 4:00 PM
Tuesday8:00 AM - 4:00 PM
Wednesday8:00 AM - 4:00 PM
Thursday8:00 AM - 4:00 PM

Footer

footer-logo
  • Facebook
  • LinkedIn
  • Twitter
  • YouTube

The information on this Vermont Attorneys & Lawyers / Law Firm website is for general information purposes only. Nothing on this or associated pages, documents, comments, answers, emails, or other communications should be taken as legal advice for any individual case or situation. This information on this website is not intended to create, and receipt or viewing of this information does not constitute, an attorney-client relationship.

American Academy of Estate Planning Attorneys, Inc. Privacy Policy | Contact Us | Disclaimer | Site Map | Powered by American Academy of Estate Planning Attorneys

© 2022 American Academy of Estate Planning Attorneys, Inc.