In January, the U.S. Government Accountability Office (GAO) issued the report Participants need better information when offered lump sums that replace their lifetime benefits. This is much easier said than done. There is so much information included in lump-sum kits that they typically run at least 25 pages. The Special Tax Notice alone takes up five pages.

The relative value rules are supposed to give participants a heads-up if they re about to forfeit an early retirement subsidy, but very few participants ask questions about the relative value descriptions in their pension kits. Could the reason be that the relative values clarify things so much that everyone understands all the consequences of their elections? Could it be that participants are already suffering from information overload and simply tune out?

Better information is only better if participants understand it and are willing to take the time to read it. Unless each lump-sum kit is hand-delivered by a pension specialist and an actuary, participants will never understand the required information.

There is still a great deal of interest in offering lump-sum windows. Many plan sponsors have been offering lump sums to terminated vested participants, and in 2012, both Ford and General Motors got approval to offer their retirees the opportunity to trade in their lifetime payments for lump sums.

The Internal Revenue Service (IRS) has, for the time being, stopped issuing Private Letter Rulings allowing companies to offer lump sums to retirees. But why? Are they afraid retirees will be bilked out of their future payments? Retirees wouldn't be losing out on any early retirement subsidies like terminated vested participants might. Furthermore, there are several reasons why it might be very advantageous for retirees to take lump sums:

• If they don t expect to live very long

Remember that retirees are old. If you knew your days were numbered and you were receiving monthly payments for life, wouldn't you jump at the opportunity to trade your $200 monthly payment for an $18,000 lump sum?

• If their monthly annuity payments are ridiculously small

Many plans only pay lump sums if the total present value is under $5,000 at the time of commencement. As a result, there are a lot of retirees out there who are receiving monthly payments of less than $50. They would probably appreciate the opportunity to turn that small payment into a chunk of money they could actually do something with.

• If their financial situations have changed

People's situations change over the course of time. Retirees may decide that, for whatever reason, the lump-sum payment could give them the opportunity to pay off a debt, buy an RV, or invest in a business.

Instead of saying that participants need better information, why not accept that every participant's situation is different and no amount of additional information is going to change the fact that they know what they want?