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Subject:
UK Pension Valuation: Putting a market value on a UK final salary pension
Category: Business and Money > Accounting Asked by: jf123-ga List Price: $10.00 |
Posted:
03 Dec 2005 14:13 PST
Expires: 17 Dec 2005 13:44 PST Question ID: 601007 |
I am looking for a valuation, including the methodology used, for a UK final salary pension. Details are as follows: I have worked for 10 years and the pension is based on 1/60ths of final salary payable at 60. I am 36. Once paid, the pension is guaranteed to rise annually by RPI upto 5% and by higher than 5% at the descretion of the trustees. 50% of the benefit is paid to my wife upon my death until her death. So if my currently salary is £x/annum, what would be the market value (i.e. open market replacement cost) of such a scheme and how is this calculated? |
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There is no answer at this time. |
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Subject:
Re: UK Pension Valuation: Putting a market value on a UK final salary pension
From: murunbuchstansinger-ga on 04 Dec 2005 12:59 PST |
The trustees are required to give a transfer value if requested and this is effectively the market value, as they determine how much can be transferred in £, S and D as it were. There are many reasons you might require a value - divorce, moving jobs, transferring scheme or even the amount of your lifetime allowance which will be "used" by this portion of pension post 6th April next year - AKA "A day". You may also want to bear in mind other benefits attached to your pension - are there also dependants pensions payable - is there death in service (often 4x salary), is early retirement allowable under the scheme?. Doesn't answer your question, as I will leave that for a paid researcher, but you might want to clarify your question if you want an answer to suit your needs properly. Good luck |
Subject:
Re: UK Pension Valuation: Putting a market value on a UK final salary pension
From: murunbuchstansinger-ga on 04 Dec 2005 13:02 PST |
Actually, I have just re-read your question. You say "open market replacement cost". It is very very easy to get a misleading answer to this question, even if you have lots of formulae and (erk!) assumptions to back it up. The key being "replacement". I'll let you work out why. |
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