how to value a paying pension?

de1amo

i like to chew over numbers and i was wondering if anyone can give me a valuation of a pension that i am currently being paid--its 7500pa indexed linked to inflation and i am 47---is it as simple as multiplying my 'hoped ' for life by its amounts payable?

getmore4less

I recon you need a lump sum invested of around 20-25 times the pension.

But this does carry some risks and you can draw down later in life.

So worth about(@25x) £187.5K say £200k to be on the saver side.

Anuity rates give you another measure.

CLAPTON

look up annuity rates for a 47 year old indexed to RPI presumably with 1/2 pension for spouse and see what an income of 7500 will cost.


but in excess of 350,000

EdInvestor

Under the lifetimne allowance HMRC uses a valuation of 20% for pensions in payment, which would work out at £150,000.

Andy_L

Although doesn't that assume an age of 60/65ish rather than 47?

de1amo

so it looks like 150k--its a BT pension---is there any danger to it in view of that pensions current deficit?-thanks for the answers chaps!!
İts odd because i have drawn 110k already on this pension--i plan to live for a few more years being 47-and my widow gets a percentage and shes young!!

CLAPTON

tyou haven't said for what purpose you wish to 'value' the pension
clear 150,000 doesn't present the 'price' you would have to pay to purphase these benefits.

de1amo

i was justing wondering what my net worths are--i see lots of people saying how much their pensions are worth in life!!