Some consumers who get a cash windfall from a retirement plan or lawsuit settlement find a way to hang on to the money, but many blow all of the cash quickly.
Analysts at a unit of MetLife Inc. reported new data on consumers' management of lump-sum payouts today.
— (Related on ThinkAdvisor: Pension cash-outs trending upward)
The analysts based the data on results from a web-based survey of about 1,069 U.S. adults ages 18 and older.
The sample included three types of people:
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Adults ages 50 to 75 who had received a lump sum of at least $25,000 from a defined benefit pension plan. Some withdrew the value in the form of a lump sum, and some receive monthly annuity payments of $500 or more.
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Adults ages 50 to 75 who had a defined contribution plan balance of at least $25,000 when they retired. Some withdrew part or all of the balance, and some receive monthly annuity payments or $500 or more.
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Adults ages 18 to 75 who had received a lawsuit settlement of $25,000 or more, and who had been given a choice of receiving the settlement as a lump sum or as an annuity.
The MetLife analysts found that 62% percent of the lump-sum recipients surveyed said they still have at least some of the cash.
