GM Pension Calculator: Lump Sum vs Monthly Annuity
Enter the monthly amount from your GM pension statement. The calculator values it at the IRS 417(e) minimum rates, checks the PBGC guarantee if GM still pays you, and shows how a lump sum would hold up if you invested it.
Get retirement alerts
We track IRS rule changes, rate updates, and retirement law changes. One email when something moves enough to affect your math.
How the 417(e) minimum works
A plan doesn't have to offer a lump sum. If it does, IRC 417(e) sets the least it can pay. Each expected monthly payment is weighted by the chance you're alive to get it, using the IRS mortality table, and discounted at one of three segment rates: one for payments under 5 years away, one for 5 to 20 years, and one beyond 20 years. Higher rates mean smaller lump sums.
Each plan picks which month's rates to use. The calculator defaults to the November 2025 rates, which many calendar-year plans use for 2026, but your GM election packet lists the rates your plan actually used. If you're years from your start date, the value today is lower than the value at the start date because you're also discounting the wait and the chance of not reaching it.
Comparing an offer to this number tells you whether the plan is paying at least the legal minimum. It doesn't tell you whether the lump sum is the right choice for you.
GM's salaried and hourly plans
GM's U.S. salaried pension covers employees hired before January 2001. GM stopped salaried accruals on September 30, 2012, and active salaried employees moved to defined contribution contributions. That was a full accrual freeze, not just a closure to new hires.
Hourly employees hired before October 15, 2007 are in plans that pay stated amounts for each year of service, with supplements for people who retire with 30 years before normal retirement age. Hourly employees hired after that date are in a defined contribution plan.
The 2012 lump sums and Prudential transfer
In June 2012 GM announced it would offer lump sums to about 42,000 salaried retirees and surviving beneficiaries and buy a group annuity from Prudential for most of the remaining salaried retirees. GM expected the moves to cut its salaried pension obligation by $26 billion.
GM paid $3.6 billion in lump sums to 12,500 participants in August 2012 and a $25.1 billion annuity premium in November and December 2012. Prudential began paying those retirees in January 2013. GM said salaried employees still in the plan could choose a lump sum or a monthly pension at retirement, paid by GM.
PBGC doesn't guarantee an annuity once an insurer has taken it over. Your state's life and health insurance guaranty association backs it instead. In most states that limit is $250,000 in present value for annuities, and some states set it higher.
PBGC protection
For 2026, PBGC guarantees a straight-life annuity starting at 65 up to $7,789.77 a month. The cap is lower if payments start earlier ($6,153.92 at 62, $3,505.40 at 55) and lower again for a joint and 50% survivor annuity ($7,010.79 at 65). The calculator checks your amount against the row for your start age and form.
Sources
For high-stakes decisions
Running six-figure numbers? Get a second opinion.
A fee-only fiduciary can model your specific situation. No products sold. No commissions. Most charge $200-500 for a one-time analysis.
Find a fee-only advisorPensionMath earns no referral fee from NAPFA. We link there because it is the most trusted source for fee-only advisors.
Frequently asked questions
Who pays my GM pension, GM or Prudential?
Most salaried retirees who started benefits before December 1, 2011 and didn't take the 2012 lump sum are paid by Prudential. Active salaried employees and later retirees stayed in a GM plan. Your payment statement shows who pays you.
Did GM freeze the salaried pension?
Yes. Salaried accruals stopped September 30, 2012, and active salaried employees moved to defined contribution contributions. Salaried employees hired in 2001 or later were never in the pension.
Can I take a GM pension lump sum?
GM's 2012 announcement said salaried employees remaining in the plan could choose a lump sum or a monthly pension at retirement. Check your election packet for your options.
Is a GM pension paid by Prudential covered by PBGC?
No. Once Prudential took over those annuities, PBGC no longer guarantees them. State insurance guaranty associations back them instead, usually up to $250,000 in present value.