# Classic Suze School: The Right Pension Option

An episode of [Suze Orman's Women & Money (And Everyone Smart Enough To Listen)](https://invisiblenetwork.ai/podcast/1439621652), 17 Sep 2026, 24 min.

Audio: https://traffic.omny.fm/d/clips/2df1102a-5761-4c99-b489-aabd0161f8fe/44e0936e-923c-43c7-9e2a-aade00edf4d3/60f98781-83ec-4074-a634-b4c8000ba1f2/audio.mp3?utm_source=Podcast&in_playlist=4e05fb00-5a5b-4ed9-b353-aade00edf4dd

This Classic Suze School is a lesson on choosing the right joint and survivor benefit pension option for you and your spouse. Learn more about the Ultimate Scam Protection here: SuzeOrman.com Watch Suze’s YouTube Channel Jumpstart financial wellness for your employees: https://bit.ly/SecureSave Protect your financial future with the Must Have Docs: https://bit.ly/3Vq1V3G Help with the Must Have Docs: • Email:support@musthavedocuments.zendesk.com • Phone: 888-510-0510 Get your savings going with Alliant Credit Union: https://bit.ly/3rg0Yio Get Suze’s special offers for podcast listeners at suzeorman.com/offer Join Suze’s Women & Money Community for FREE and ASK SUZE your questions which may just end up on the podcast. Download the app by following one of these links: CLICK HERE FOR APPLE: https://apple.co/2KcAHbH CLICK HERE FOR GOOGLE PLAY: https://bit.ly/3curfMI See omnystudio.com/listener for privacy information.

## Transcript

[0:07] Robert: September 17th, 2026. Welcome to the Women and Money podcast,
[0:11] Robert: as well as everyone smart enough to listen. Hi there, Robert,
[0:14] Robert: the producer here. Over this past weekend, I was at
[0:17] Robert: a baseball game and I struck up a conversation with
[0:20] Robert: the folks sitting next to me, and one of them
[0:22] Robert: mentioned that he was going to retire soon and was
[0:25] Robert: looking forward to being able to see more Red Sox games.
[0:29] Robert: And his son said, well, Dad, you need to figure
[0:30] Robert: your pension thing out first.
[0:33] Robert: We'll use that as a bit of inspiration for today's
[0:36] Robert: classic Suze School, which is all about selecting the right
[0:39] Robert: pension option.
[0:42] Robert: Enjoy.
[0:46] Suze: Now, KT mentioned that she loves teachers, and there are so,
[0:52] Suze: so many teachers out there. And today, one of the
[0:58] Suze: occupations that still get a pension when they retire happens
[1:04] Suze: to be teachers. Maybe you remember years and years ago
[1:10] Suze: when you worked for a corporation.
[1:12] Suze: After 20 or 30 years of working for them, and
[1:15] Suze: then you retired, they gave you a monthly pension, and
[1:20] Suze: that pension was a fabulous thing to have, and then
[1:24] Suze: that really was replaced by 401k plans. And so, therefore,
[1:32] Suze: many people out there don't have pensions anymore, 'cause all
[1:36] Suze: you have are your 401ks, however, many of you still do.
[1:43] Suze: When you do get a pension, like most teachers do,
[1:49] Suze: you have options for that pension.
[1:53] Suze: And the options are called joint and survivor benefits.
[1:59] Suze: And what that means, get out your Suze notebook, 'cause
[2:03] Suze: maybe you don't get a pension, but maybe one day
[2:06] Suze: your kid will, or your mother will, or your father,
[2:10] Suze: or whatever it may be, or just a friend, and
[2:14] Suze: they need advice. So, take out your Suze notebooks, 'cause
[2:18] Suze: this is really a good Suze school, just for all
[2:22] Suze: of you to know. All right.
[2:25] Suze: When you get a pension, they give you options as
[2:28] Suze: to how do you want to take that pension.
[2:32] Suze: And what that means isn't how do you want to
[2:35] Suze: take it weekly, biweekly, whatever it means, do you want
[2:39] Suze: to get your full pension amount, which means you will
[2:44] Suze: get X per month, but if you die, it's called
[2:48] Suze: a life only, if you die, your spouse will get
[2:52] Suze: absolutely nothing.
[2:56] Suze: Or do you want to take a 100% joint and
[3:01] Suze: survivor option where whatever you get upon your death, your
[3:08] Suze: spouse will get 100% of whatever you were getting and
[3:13] Suze: there's all different kinds of percentages you can get 100%
[3:18] Suze: joint and survivor benefit.
[3:21] Suze: Which again is where your spouse gets 100% of what
[3:24] Suze: you're getting, 75% joint and survivor benefit, which means your
[3:30] Suze: spouse would get only 75% of what you were getting, 50%
[3:36] Suze: joint and survivor benefit, which means your spouse would get
[3:39] Suze: only 50% of what you were getting.
[3:43] Suze: And 25%, which means your spouse would only get 25%
[3:49] Suze: of what you were getting.
[3:52] Suze: And obviously, in order to leave your spouse money after
[3:58] Suze: you have died, that's like an insurance policy.
[4:03] Suze: So what happens is whatever you are entitled to for
[4:08] Suze: your full pension, your life only pension, they will pay
[4:12] Suze: you that every month, and again, if you die, your
[4:15] Suze: spouse gets nothing. They reduce the amount of money that
[4:20] Suze: would be the life only option.
[4:24] Suze: Depending on, do you choose the 100%, 75%, 50%, or 25%
[4:31] Suze: joint and survivor option. That's how it works. Now, obviously,
[4:38] Suze: if you are not married, you want to take the
[4:42] Suze: life only option, 'cause remember, joint and survivor benefits are
[4:49] Suze: only for those who are married.
[4:54] Suze: And I will now read you the email that spurred
[4:58] Suze: this Suze School.
[5:01] Suze: Hello Suze and KT. Thank you both for everything you do.
[5:06] Suze: This question is about choosing or not choosing a joint
[5:11] Suze: and survivor option for my spouse when retiring. I am
[5:16] Suze: looking to retire next July 1st at age 66, and
[5:21] Suze: my wife is currently retired at age 67. Can you
[5:27] Suze: write these numbers down?
[5:30] Suze: 'Cause this is how you also think about Social Security
[5:33] Suze: and other things in life, all right? So, do this
[5:37] Suze: with me. Learn from this, pretend you are me, and
[5:42] Suze: a friend has asked you this question.
[5:45] Suze: How would you answer it? So, Suze School isn't just about,
[5:50] Suze: this is what you need to know.
[5:52] Suze: Money has to be an understanding of what you need,
[5:58] Suze: what you want, how you feel about it, all of that.
[6:03] Suze: So you have to understand how it works.
[6:07] Suze: So, 66, and my wife is 67, and currently retired.
[6:14] Suze: I am a teacher, so I will be entitled to
[6:18] Suze: a pension of about $2,595 a month.
[6:25] Suze: Now remember, write that down.
[6:27] Suze: I said a life only option. Your full pension in
[6:32] Suze: this case, his name is Steve, is $2,595 a month.
[6:40] Suze: That's what he would get. And if he took that,
[6:43] Suze: and by the way, the spouse always has to give
[6:45] Suze: permission to take anything less than 50%, just so you know,
[6:51] Suze: if he were to take that and the life only option.
[6:54] Suze: Upon his death, his spouse gets absolutely nothing.
[7:00] Suze: He goes on to say, I cannot decide whether to
[7:04] Suze: choose a joint and survivor option or not. The 100%
[7:10] Suze: joint and survivor option is $2,141. Write it down. The 75%
[7:20] Suze: joint and survivor option is $2,245.
[7:26] Suze: The 50% joint and survivor option is $2,361. Do you
[7:34] Suze: see how it's going up, because you're leaving less to
[7:36] Suze: your spouse upon your death? And the 25% joint and
[7:41] Suze: survivor option would be $2,481.
[7:48] Suze: He goes on to say my wife does not have
[7:52] Suze: a pension, only Social Security.
[7:56] Suze: We have about $1.2 million in IRAs. He did not
[8:03] Suze: say Roth IRAs. He said IRAs, which means taxable. When
[8:09] Suze: they go to take the money out, it will be taxable. OK.
[8:15] Suze: It's in equities and fixed income. They own their own
[8:19] Suze: home with no mortgage. Write it down, and they have
[8:23] Suze: no debt. He doesn't say how much the home is worth,
[8:28] Suze: and so we just have to assume it's a nice home.
[8:32] Suze: All right, he says, I feel we have enough for
[8:39] Suze: her to survive should I pass before her.
[8:44] Suze: Please give me your thoughts on this. I really do
[8:47] Suze: need your feedback to help decide the best option. Steven,
[8:51] Suze: I love that you wrote in because years ago, years
[8:55] Suze: ago when I was seeing clients, I also was the
[9:00] Suze: retirement planner for Pacific Gas and Electric, which was the
[9:03] Suze: utility company for Northern California.
[9:06] Suze: And at one point there they had 7,000 people retire
[9:10] Suze: and they all came to see me and they all
[9:13] Suze: had to choose which joint and survivor benefit they were
[9:18] Suze: going to choose. So I went through this and went
[9:22] Suze: through this with thousands of people over my career. So
[9:26] Suze: I can tell you hands down, that I want you,
[9:31] Suze: without a shadow of a doubt, to choose the 100%
[9:35] Suze: joint and survivor option. Now, I want all of you
[9:40] Suze: to listen to me.
[9:43] Suze: Obviously, if Steven chooses the 100% joint and survivor option,
[9:51] Suze: that means all Stephen is going to get is $2,141
[9:57] Suze: a month. They will have reduced his full pension by
[10:01] Suze: $454 per month. I know that in this case that
[10:07] Suze: seems like a lot of money.
[10:11] Suze: Why do they reduce it by so much? They reduce
[10:15] Suze: it because obviously Stephen through his work is in essence,
[10:22] Suze: the company is buying a life insurance policy, or that's
[10:26] Suze: how much it will cost them to insure the fact
[10:29] Suze: that they can provide Stephen's spouse with 100% every month
[10:35] Suze: for the rest of her life.
[10:38] Suze: $2,141. Now, just write those numbers down.
[10:45] Suze: When I was doing planning for Pacific Gas and Electric,
[10:48] Suze: a lot of people said to me the following, and
[10:51] Suze: you are never, ever to do this.
[10:55] Suze: They said, All right, Suze, we're going to take the
[10:58] Suze: $2,595 the full pension, and we're going to buy a
[11:05] Suze: 20 year level term policy on me. So if I die,
[11:11] Suze: my spouse will be OK. Are you kidding me?
[11:16] Suze: This isn't about 20 years from now, and 20 years
[11:19] Suze: from now, Stephen may be what, 86. He could live
[11:23] Suze: easily into his 90s if he's healthy, and at the
[11:26] Suze: time that if his spouse is still alive, that she
[11:28] Suze: needs the money the most. A 20-year level term policy
[11:32] Suze: goes away.
[11:34] Suze: And the plan usually is, they will take the difference
[11:38] Suze: from the $2,595 and use it to buy a term
[11:42] Suze: life insurance policy to protect the spouse.
[11:47] Suze: Now, you would have to buy at least a $700,000
[11:53] Suze: life insurance policy to protect the spouse in this situation. Why?
[12:01] Suze: Cause $700,000 of insurance, Stephen dies, the spouse, she would
[12:07] Suze: invest that $700,000 and let's just say she could get 4%
[12:11] Suze: on that.
[12:12] Suze: That's about $28,000 a year. Obviously, it will be taxable,
[12:17] Suze: not the $700,000 but the income from it. So after
[12:20] Suze: taxes and everything, that'll probably leave her about $25,000 or
[12:24] Suze: $26,000 a year to live on, which is what she
[12:28] Suze: would be getting with the 100% joint and survivor option.
[12:33] Suze: 'Cause remember, $2141 a month is $25,692 a year. Are
[12:41] Suze: you all following me?
[12:43] Suze: However, you can't do it that way. If you want
[12:48] Suze: to replace the $700,000 life insurance policy to guarantee your
[12:55] Suze: spouse will always be OK, a $700,000 life insurance policy
[13:01] Suze: is not just going to be $4,000 or $5,000 a year.
[13:06] Suze: If it's a whole life policy, it is not going
[13:10] Suze: to be that cheap.
[13:12] Suze: So, you are far better off doing it where? Doing it
[13:16] Suze: through the place of employment and taking the 100% joint
[13:21] Suze: and survivor option, cause remember, if you take the full option,
[13:27] Suze: the life only, which in this case is 2,595, $454
[13:35] Suze: more than the 100% joint and survivor option. That $454
[13:43] Suze: will be taxable to you, Stephen.
[13:46] Suze: So you're not going to really have that much more,
[13:49] Suze: believe it or not.
[13:51] Suze: That's number one. Why do I not want you to
[13:54] Suze: take the 75% or the 50% or the 25%? I
[14:00] Suze: have done this enough now. When one spouse survives the other,
[14:05] Suze: they will lose one Social Security check number one and
[14:11] Suze: things can happen, and every single penny matters. You, Stephen,
[14:18] Suze: think you have a whole lot of money cause you
[14:20] Suze: own your home outright. You have $1.2 million in an
[14:25] Suze: IRA right now. You have it right now.
[14:29] Suze: What happens if it goes down? What happens if you
[14:32] Suze: didn't protect it? What if it was a few years ago,
[14:35] Suze: a year or so ago, you died.
[14:38] Suze: And now your bond portfolio, cause you thought you were
[14:41] Suze: gonna protect all this money, and you bought mutual funds
[14:43] Suze: with bonds in them, and it went down 30%.
[14:48] Suze: Or what happens if the stock market crashes or interest
[14:51] Suze: rates go down. That $1.2 million doesn't mean unless you
[14:57] Suze: put it all in treasuries you keep it all safe
[15:00] Suze: and sound.
[15:02] Suze: Isn't really that much money, if you think about it.
[15:08] Suze: 'Cause remember, starting at the age of 73, you're under
[15:13] Suze: required minimum distributions, and that is just 7 years from now, Stephen.
[15:18] Suze: And therefore, you have to start taking money out of
[15:22] Suze: the 1.2 million, and probably after taxes and everything, and
[15:26] Suze: it will end up just being spent because of inflation
[15:29] Suze: and everything like that.
[15:32] Suze: So that's number one. Number two, your home.
[15:37] Suze: When a spouse, a woman loses her husband or her wife.
[15:46] Suze: Normally she does not want to sell the house that
[15:50] Suze: they were living in at that time.
[15:54] Suze: She wants to stay in there. She doesn't want to
[15:57] Suze: give away your clothes. She wants the memories. It can
[16:00] Suze: take two years before she sells it. Now, I have
[16:05] Suze: been doing this long enough, dealing with female spouses, male
[16:11] Suze: spouses that have survived their partners, and I can tell you,
[16:16] Suze: women have more of an attachment to the house and
[16:22] Suze: things like that than usually the men do. It's just
[16:27] Suze: something that I have noticed over the 40 years that
[16:31] Suze: I have been dealing with things like this.
[16:35] Suze: But regardless, you cannot assume that a spouse right after
[16:42] Suze: you've died, everybody, is just gonna be able to sell
[16:45] Suze: the house. And what if it was 2007, 2008, when
[16:49] Suze: real estate had crashed.
[16:52] Suze: And the house that was worth $700,000 in Tampa, Florida
[16:56] Suze: was worth only $100,000 now.
[17:00] Suze: What if that? The truth of the matter is, you're
[17:03] Suze: not gonna buy insurance because insurance is too expensive, whatever
[17:07] Suze: it may be. So you've taken the $2,595, you didn't
[17:11] Suze: buy insurance.
[17:14] Suze: And you die the next day afterwards. Your spouse now
[17:18] Suze: could easily live another 30 years without that income, without
[17:24] Suze: that income at all.
[17:26] Suze: You're not even old enough to be claiming Social Security
[17:29] Suze: at that point, because you should absolutely be waiting till
[17:32] Suze: you're 70 to do so. But let's just say you die.
[17:37] Suze: And now your spouse gets to take your full Social Security.
[17:42] Suze: Your full Social Security doesn't really start to be the
[17:46] Suze: full primary amount till you're 67. I know I'm driving
[17:49] Suze: all of you crazy right now.
[17:51] Suze: But these are the things that can happen. So how
[17:55] Suze: is she going to support herself? She's going to lose
[17:58] Suze: her Social Security and probably take over yours if yours
[18:02] Suze: is higher than hers. But now she has lost the
[18:06] Suze: pension that you two were supposed to be enjoying and
[18:09] Suze: her Social Security. Are you kidding me?
[18:15] Suze: So here is the real question. If you can't do
[18:21] Suze: without $454 a month right now, my dear Stephen.
[18:28] Suze: Are you asking her to do without your total $2,595
[18:36] Suze: a month. Is that what you are asking her to do?
[18:41] Suze: You absolutely can make it, both of you with what
[18:45] Suze: you have on $2,141 a month as a pension. You
[18:53] Suze: can do that.
[18:55] Suze: But don't ask her to do so. Do you understand
[19:00] Suze: what I'm saying?
[19:02] Suze: Are there exceptions to what I just said? Of course
[19:06] Suze: there are. If your spouse is seriously ill and she
[19:11] Suze: is expected to die, then possibly you could do it
[19:15] Suze: and take out a term insurance policy and protect her
[19:19] Suze: just in case something happened to you like an accident
[19:22] Suze: before she passed.
[19:25] Suze: Or you can all ask your companies, do they have
[19:30] Suze: something called a pop-up option?
[19:35] Suze: And a pop-up option is this. It is where you
[19:41] Suze: take the 100% joint and survivor option and if your
[19:46] Suze: spouse dies before you, you get to pop up to
[19:51] Suze: the full amount, and in this case, the $2,595.
[19:56] Suze: Stephen, ask if they have a pop-up option, because chances
[20:02] Suze: are the STRS system or the PR system, which you
[20:07] Suze: are a part of as a teacher. The last I
[20:12] Suze: knew they had a pop up option. If they do that,
[20:17] Suze: then you take the 100% joint and survivor benefit with
[20:21] Suze: the pop up option.
[20:25] Suze: Just know, with the pop-up option, it will cost you
[20:29] Suze: a little bit, but not as much as a plain 100%
[20:34] Suze: joint and survivor benefit.
[20:38] Suze: So those are things you need to remember.
[20:42] Suze: The bottom line is this, if your spouse is totally healthy,
[20:49] Suze: if they don't offer the pop-up option.
[20:53] Suze: I don't really care how much money you have because
[20:56] Suze: the truth of the matter is you just never know
[20:58] Suze: what can happen in life. I have found over all
[21:02] Suze: the years I have been doing this that truthfully the
[21:06] Suze: only way to go is the 100% joint and survivor option.
[21:13] Suze: With the school district or company that you are working for. Now,
[21:18] Suze: I just want to say one other thing. If I
[21:21] Suze: were in your situation, and I had the amount of
[21:25] Suze: money that I have today, and KT had the amount
[21:30] Suze: of money that she has today, which is multi-millions of
[21:33] Suze: dollars in her name.
[21:35] Suze: And I was about to get a pension, I would
[21:39] Suze: still take the 100% joint and survivor option. I would never, ever,
[21:46] Suze: ever take a life only option.
[21:51] Suze: All right, now listen to me, everybody. Every corporation, school system,
[21:55] Suze: whatever it may be, they have different variations of pension options,
[22:01] Suze: but this Suze School today gives you a good overview
[22:05] Suze: of things that you should think about when choosing which
[22:10] Suze: option you want.
[22:13] Suze: So, I hope this wasn't too complicated for you. But
[22:17] Suze: I know it's not, because I know that you're all
[22:19] Suze: getting smarter and smarter, but these are the ways that
[22:24] Suze: I want to start training your brain to think and
[22:28] Suze: to guide you into things that can happen.
[22:32] Suze: And I know $1.2 million sounds like a lot of money.
[22:36] Suze: It would have been a whole lot more, by the way, Stephen,
[22:38] Suze: if you had had it in a Roth IRA where
[22:42] Suze: no taxes would be due, no required minimum distributions, no
[22:47] Suze: taxes to her on this money upon your death. Then
[22:52] Suze: maybe it would be different, but that's not how it is.
[22:58] Suze: So before I sign off today, wherever I go, come on,
[23:02] Suze: say it with me today, wherever I go, I will
[23:05] Suze: create a more peaceful, joyful, and loving world, and if
[23:10] Suze: you do that, I promise you you will be unstoppable.
[23:16] Suze: Bye bye.

Shows are listed from Apple Podcasts' charts and directory, and Podcast Index where it is used. Every show and episode belongs to its publisher and plays from the publisher's own feed; this site hosts none of them.