By Scott Burns

Q. My wife, age 57, is retiring at the end of the year. She has a teacher’s retirement pension with different options. We have narrowed the decision down to two options:
—She can receive $1,900 a month for life, or;
—She can receive a one-time lump sum of $26,000 and $1,700 a month for life.

Would it be a good idea to roll over the lump sum into an IRA account (so she could continue to defer taxes) or would it be wiser to keep it simple and take the full pension? We feel the second choice would give us a good little nestegg, but only if we put it to work wisely. —R.A., by email

A. Most people, most of the time, are better off taking the full pension rather than the pension and cash— if they have the option at all. The primary reason for this is income. You won’t be able to get nearly as much income from investing the cash as you will get from the pension.

At your ages, to get the same $200 a month from the $26,000 lump sum as you would get from the pension, for instance, you would need a reliable return of 9.2 percent. That isn’t going to happen. A more likely result is about 4 percent or $1,040 a year. That’s less than half of taking it as a pension life income. (Note: This isn’t an apples-to-apples comparison, the 9.2 percent is fixed for life while the 4 percent might rise with inflation and could even be left in your estate. The full pension disappears when you do.) Even so, it would be years— possibly your lifetimes— before you’d have more purchasing power from the investment than from the pension.)

So unless you have no other savings— nothing in an IRA, 403(b) or other investment account— you should take the full pension.

Q. A few years ago, I made an expensive impulse purchase. I bought a Marriott time-share, located on Spain's Costa del Sol on the Mediterranean Sea. I conveniently, and regrettably, forgot to delve further into the details concerning the annual maintenance fees, etc. I no longer call my timeshare an "investment"— as it was portrayed during the low-key sales presentation.

Having the timeshare forces me to regularly take more meaningful (and expensive) vacations than I might otherwise take. I've grown accustomed to the semi-complex features of the program: Balancing the splitting of my 3 bedroom unit into 2 sections and getting 2 weeks to trade via Interval International; taking Marriott points every other year to use at other Marriott properties; and, coordinating a timeshare week at a location of my choosing which also corresponds with reasonable airfares to the nearest airport.

I understand that my annual fees actually provide something of value to me: 7 nights at my home resort, which is really a very good price per night for a 3 bedroom, 3 bath unit. However, I would prefer that the time-share be located in the US. This would save on travel expenses and avoid exchange-rate fluctuations with the euro. Would I do it all over again? A resounding "No!" I'd rather have my purchase money for true "investments."

With the possibility of a bailout by the European Union for Spain, how might this affect my timeshares annual maintenance fees? Is it likely that they will increase dramatically? Or, could the Euro's value relative to the dollar decline due the weakened strength of the EU as a whole?

Should I cut my losses and sell the timeshare? I know the world economy will rebound and there will always be a fluctuating demand for first class vacation facilities along the Mediterranean. So, the well-managed and maintained Marriott resort should hold its value, and, might even appreciate. It would probably have to double in value for me to get back my original investment. —W.N., by email

A. A timeshare is a pretty tough way to bet on the future of the Euro and inflation. In the current environment, we can be pretty sure that lots of people are thinking very much as you are. If they have a timeshare at all, they will want it close to home, perhaps even within driving distance.

Realistically, you’ve got two choices: (1) trade your existing timeshare points for time at places that are much closer or (2) sell it and take the loss.