lump sum or annuity? I am retirring in 6 months, which is the best alternative. I am not a risk taker.

If you take a lump sum, you will then need find your own investments to give you an income. The annuity will guarantee you an income for life. You need to weigh the return you might get vs that offered by the annuity.

If you are not a savvy investor and have a low risk tolerance I would suggest the annuity might be better for you.

Keep in mind also that there are different types of annuities, i.e.. A lifetime income for you only, a lifetime income to you and when you pass to a survivor of your choice for perhaps their lifetime. You stated that you are not a risk taker but keep in mind that there is also a rink of inflation that might (and more than likely will) diminish the value of your lifetime income.

My first thought would be to take the lump sum.

Scott and Richard have both given you very good reasons.

But, it does depend on how much money we are talking about and their perspective interest rates.

I don't disagree with the other answers, but the real question is where is the money and who is going to guarantee the payment. I had the same situation several years ago. Although I worked for a very successful company I would prefer to in charge of my own money. I would take the lump sum, set up an account with Vanguard or one of the other Low Cost investment companies and spread the money over a few conservative funds. Just my opinion. It has worked great for me.

This is far to complicated, what type of fund is the money coming from, is it from a tax deffered account, if so, if you take the full amount out, you will pay tax on the entire amount the year you take it out.

If you take the full amount you can also buy an annunity from another firm

There are as listed dozens of types of annunities that can be offered, a specific number of years ( you could outlive the payments) a payment for life ( but payments end when you die) annunity to the life of two people if you are married perhaps, annunity with right of a survivor ( they get balance if you die early) and more