Transfer Value v Fund Value question

GillianD

xylophone said:

Can that be correct i.e. the huge difference between fund and value?

In a DB pension, you do not have a fund (pot) as such - you have the promise to pay certain benefits  (related to salary/length of service etc) when you take your benefits from the scheme.

This is different from a DC/Money Purchase scheme.

https://www.thepensionsregulator.gov.uk/en/document-library/scheme-management-detailed-guidance/administration-detailed-guidance/transfer-values

A CETV represents the expected cost of providing the member's benefits within the scheme. In the case of money purchase benefits, this is generally straightforward – it is the accumulated contributions made by and on behalf of the member together with investment returns.

 In the case of defined benefits, the CETV is a value determined on actuarial principles, which requires assumptions to be made about the future course of events affecting the scheme and the member's benefits.

Do you mind me asking why the significant TV from the DB scheme doesn't show in my annual statement for that plan which shows an annual pension of about £200? Is that just because it is an estimate not a projection as such so can't include the specifics eg GMP etc?