Pension projections - clarification

Richie(UK)

Hi all,

If a life company issues a pension illustration that projects an annual pension of, for example, £10,000 pa is this :
* on the basis of the fund as it stands and growth at the indicated rate or
* does it also assume that contributions will continue at the current rate?

(I know, I know, read the documentation - I will when I get home but the thought has just occurred to me )

dunstonh

If a life company issues a pension illustration that projects an annual pension of, for example, £10,000 pa is this :
* on the basis of the fund as it stands and growth at the indicated rate or
* does it also assume that contributions will continue at the current rate?

It can be either of those or both. Typically, if you are supplied just one projection, it is on the basis of what you are paying and the indexation level you have.

jamesd

The projection should state the basis but assuming you're a current employee dunstonh covers it: probably specified investment returns and continuing contributions. You may also get a projection of state pension payout as part of the package if your employer has signed up to that scheme.