Taking deferred DB pension early

Tommyjw

Hoenir said:

Tommyjw said:

Some DB companies are just crap at giving future projections, its such a basic request for us that i find it so odd i wouldnt believe it hapoens unless i read it on this forum, its literally no more calculated than giving a current one, just add +X% per year remaining and caveat letters with more wording about it being an estimate and you're done. 

What value is a future projection worth? Easy enough to use a calculator and compound the pension by a % increase over a number of years. Giving estimates just provides a stick to be beaten with. When the figures turn out totally different. 

Pretty impossible for figures to be "totally different" when a reasonable approach is taken.

GMP ( by and large) are guaranteed known increases, easy.

Pre and post 09 statutory increases are capped at 5% and 2.5% respectively, you simple pick a reasonable assumption e.g. 2% for it all and use that. Compound wise, if you known 20 years and you're estimating the last 3  years, you could be 3% off each year and the overall end difference is marginal. Likewise, if you assume a middle ground over a longer period that will account for natural high and low inflation periods, you aren't going to be far off.

You ask what value it's worth yet lots of people want it.

I'd bet a lot of money there is a very high correlation between a lazy administrator who won't do this for you, and a lazy administrator who won't give you the excess/gmp split of your pension to help work it out yourself. It's not hard work, its very simple, they are just lazy and frankly  are skirting their statutory obligations to provide members with information about their DB pensions and get away with it. 

hyubh

Tommyjw said:

Hoenir said:

Tommyjw said:

Some DB companies are just crap at giving future projections, its such a basic request for us that i find it so odd i wouldnt believe it hapoens unless i read it on this forum, its literally no more calculated than giving a current one, just add +X% per year remaining and caveat letters with more wording about it being an estimate and you're done. 

What value is a future projection worth? Easy enough to use a calculator and compound the pension by a % increase over a number of years. Giving estimates just provides a stick to be beaten with. When the figures turn out totally different. 

Pretty impossible for figures to be "totally different" when a reasonable approach is taken.

GMP ( by and large) are guaranteed known increases, easy.

If fixed rate is used, sure. If full rate/S148 is used, no. Typically GMP will be the smaller component of the total pension either way.

Pre and post 09 statutory increases are capped at 5% and 2.5% respectively, you simple pick a reasonable assumption e.g. 2% for it all and use that. Compound wise, if you known 20 years and you're estimating the last 3  years, you could be 3% off each year and the overall end difference is marginal. Likewise, if you assume a middle ground over a longer period that will account for natural high and low inflation periods, you aren't going to be far off.

Yes, what you need to know is how the pension revalues to NPA, and if you are potentially interested in drawing it after NPA, what happens after that.

You ask what value it's worth yet lots of people want it.

Once you know the above, you can plug in whatever assumptions you like. Having the scheme administrator make specific assumptions for you doesn't truly get you anything, and may be actively misleading if you ignore what the material facts (viz., how the pension revalues and increases) are.

I'd bet a lot of money there is a very high correlation between a lazy administrator who won't do this for you, and a lazy administrator who won't give you the excess/gmp split of your pension to help work it out yourself.

That's two different things! Of course the administrator should be able to provide details of element splits, including how each revalues, their NPAs, and how they increase after NPA. They wouldn't be able to calculate the correct pension at DOR otherwise.

its very simple, they are just lazy and frankly  are skirting their statutory obligations to provide members with information about their DB pensions and get away with it. 

There is no statutory obligation to provide 'best guess' estimates at NPA. There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. At one point it looked like Pensions Dashboard would get the latter in through the back door, but that's no longer the case.

Lemon_dr1zzle

I work for a LGPS fund. We never apply predicted inflation to deferred estimates. It’s got nothing to do with being lazy. 

Tommyjw

hyubh said:

Tommyjw said:

Hoenir said:

Tommyjw said:

Some DB companies are just crap at giving future projections, its such a basic request for us that i find it so odd i wouldnt believe it hapoens unless i read it on this forum, its literally no more calculated than giving a current one, just add +X% per year remaining and caveat letters with more wording about it being an estimate and you're done. 

What value is a future projection worth? Easy enough to use a calculator and compound the pension by a % increase over a number of years. Giving estimates just provides a stick to be beaten with. When the figures turn out totally different. 

Pretty impossible for figures to be "totally different" when a reasonable approach is taken.

GMP ( by and large) are guaranteed known increases, easy.

If fixed rate is used, sure. If full rate/S148 is used, no. Typically GMP will be the smaller component of the total pension either way.

Pre and post 09 statutory increases are capped at 5% and 2.5% respectively, you simple pick a reasonable assumption e.g. 2% for it all and use that. Compound wise, if you known 20 years and you're estimating the last 3  years, you could be 3% off each year and the overall end difference is marginal. Likewise, if you assume a middle ground over a longer period that will account for natural high and low inflation periods, you aren't going to be far off.

Yes, what you need to know is how the pension revalues to NPA, and if you are potentially interested in drawing it after NPA, what happens after that.

You ask what value it's worth yet lots of people want it.

Once you know the above, you can plug in whatever assumptions you like. Having the scheme administrator make specific assumptions for you doesn't truly get you anything, and may be actively misleading if you ignore what the material facts (viz., how the pension revalues and increases) are.

I'd bet a lot of money there is a very high correlation between a lazy administrator who won't do this for you, and a lazy administrator who won't give you the excess/gmp split of your pension to help work it out yourself.

That's two different things! Of course the administrator should be able to provide details of element splits, including how each revalues, their NPAs, and how they increase after NPA. They wouldn't be able to calculate the correct pension at DOR otherwise.

its very simple, they are just lazy and frankly  are skirting their statutory obligations to provide members with information about their DB pensions and get away with it. 

There is no statutory obligation to provide 'best guess' estimates at NPA. There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. At one point it looked like Pensions Dashboard would get the latter in through the back door, but that's no longer the case.

It's odd to be co so confident about something, which shows the problem. Like i said, companies are getting away with not doing their statutory obligation because they go un-checked and people aren't aware. If i told any of my Trustee clients we'd stop doing this, they'd laugh at my face and tell me to go check the legislation.

https://www.legislation.gov.uk/uksi/2013/2734/regulation/16 -  
If you request it and havent been provided the same within the last 12 months, then within two months you should be given as a deferred member of a DB Scheme certain information outlined in Part 2 and Part 3 of Schedule 5.

https://www.legislation.gov.uk/uksi/2013/2734/schedule/5 
1. A summary of the method for calculating the member's benefits and any survivors' benefits
2. The amount of the member's benefits and survivors' benefits payable from the date benefits are payable.

Date benefits are payable (unless guaranteed ability to retire early in the Rules which is unusual) means your NPA. 

The difficulty is yourself and so many other people assume you can just any old DB memebr their DOL values, say "this increases by statutory revaluartion" and let them go on their way. That is lazy and is completely against doing the right thing for a member of a pension scheme when you have the expertise and ability to do so with such incredible ease.

Lemon_dr1zzle said:

I work for a LGPS fund. We never apply predicted inflation to deferred estimates. It’s got nothing to do with being lazy. 

So you provide estimates?
Estimates that use the applicable ERF or LRF for the future age?
Estimate that use the appliable CF for the future age?
Estimates that don't apply assumptions and i imagine say this in the paperwork?

And... somehow you think this is comparable to Schemes not giving anything?. If anything, this is a good example of how to do it, you've giving information whilst caveating about unknowns. 

hyubh

Tommyjw said:

hyubh said:

Tommyjw said:

Hoenir said:

Tommyjw said:

Some DB companies are just crap at giving future projections, its such a basic request for us that i find it so odd i wouldnt believe it hapoens unless i read it on this forum, its literally no more calculated than giving a current one, just add +X% per year remaining and caveat letters with more wording about it being an estimate and you're done. 

What value is a future projection worth? Easy enough to use a calculator and compound the pension by a % increase over a number of years. Giving estimates just provides a stick to be beaten with. When the figures turn out totally different. 

Pretty impossible for figures to be "totally different" when a reasonable approach is taken.

GMP ( by and large) are guaranteed known increases, easy.

If fixed rate is used, sure. If full rate/S148 is used, no. Typically GMP will be the smaller component of the total pension either way.

Pre and post 09 statutory increases are capped at 5% and 2.5% respectively, you simple pick a reasonable assumption e.g. 2% for it all and use that. Compound wise, if you known 20 years and you're estimating the last 3  years, you could be 3% off each year and the overall end difference is marginal. Likewise, if you assume a middle ground over a longer period that will account for natural high and low inflation periods, you aren't going to be far off.

Yes, what you need to know is how the pension revalues to NPA, and if you are potentially interested in drawing it after NPA, what happens after that.

You ask what value it's worth yet lots of people want it.

Once you know the above, you can plug in whatever assumptions you like. Having the scheme administrator make specific assumptions for you doesn't truly get you anything, and may be actively misleading if you ignore what the material facts (viz., how the pension revalues and increases) are.

I'd bet a lot of money there is a very high correlation between a lazy administrator who won't do this for you, and a lazy administrator who won't give you the excess/gmp split of your pension to help work it out yourself.

That's two different things! Of course the administrator should be able to provide details of element splits, including how each revalues, their NPAs, and how they increase after NPA. They wouldn't be able to calculate the correct pension at DOR otherwise.

its very simple, they are just lazy and frankly  are skirting their statutory obligations to provide members with information about their DB pensions and get away with it. 

There is no statutory obligation to provide 'best guess' estimates at NPA. There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. At one point it looked like Pensions Dashboard would get the latter in through the back door, but that's no longer the case.

Must be pretty wild to be so confident and so incorrect

While I admire your passion, I think that's because I am correct...? It is not an ABS requirement (let alone a quasi-real time on-demand requirement); there is no specified format; and the disclosure regs only say that assumptions should be specified, not what they should be.

When Pensions Dashboard finally starts this year, providing estimated retirement income for deferred DB members will be optional - a scheme administrator could just say 'no can do', and that will be fine. If what you would like the disclosure regs to say was true now, that would make no sense. That said, I would agree it would be good if the disclosure regs were tightened. Seems a bit silly for Dashboard, once properly up and running, to include standardised DC deferred ERI figures but not DB ones. (Obviously SMPI calcs may be tenuous on various levels, but at least they are standardised for comparison purposes.)

Lemon_dr1zzle said:

I work for a LGPS fund. We never apply predicted inflation to deferred estimates. It’s got nothing to do with being lazy. 

So you provide estimates?
Estimates that use the applicable ERF or LRF for the future age?
Estimate that use the appliable CF for the future age?
Estimates that don't apply assumptions and i imagine say this in the paperwork?

And... somehow you think this is comparable to Schemes not giving anything?

LGPS administrators have been required to produce deferred annual benefit statements ever since ABSs for active members become a statutory requirement, so their position is different to that of most other schemes' administrators. However, a deferred ABS for LGPS is relatively simple given revaluation (technically pension increases from leaving) is just uncapped CPI, and GMP for post-2016 SPA cases is pretty much a non-event. So whatever future inflation you hypothecate and discount back, you'll come to the same number as just revaluing to current. 

Also - estimates (in the sense of individually requested and individually produced statements) are not the same thing as annual benefit statements.

Tommyjw

hyubh said:

Tommyjw said:

hyubh said:

Tommyjw said:

Hoenir said:

Tommyjw said:

Some DB companies are just crap at giving future projections, its such a basic request for us that i find it so odd i wouldnt believe it hapoens unless i read it on this forum, its literally no more calculated than giving a current one, just add +X% per year remaining and caveat letters with more wording about it being an estimate and you're done. 

What value is a future projection worth? Easy enough to use a calculator and compound the pension by a % increase over a number of years. Giving estimates just provides a stick to be beaten with. When the figures turn out totally different. 

Pretty impossible for figures to be "totally different" when a reasonable approach is taken.

GMP ( by and large) are guaranteed known increases, easy.

If fixed rate is used, sure. If full rate/S148 is used, no. Typically GMP will be the smaller component of the total pension either way.

Pre and post 09 statutory increases are capped at 5% and 2.5% respectively, you simple pick a reasonable assumption e.g. 2% for it all and use that. Compound wise, if you known 20 years and you're estimating the last 3  years, you could be 3% off each year and the overall end difference is marginal. Likewise, if you assume a middle ground over a longer period that will account for natural high and low inflation periods, you aren't going to be far off.

Yes, what you need to know is how the pension revalues to NPA, and if you are potentially interested in drawing it after NPA, what happens after that.

You ask what value it's worth yet lots of people want it.

Once you know the above, you can plug in whatever assumptions you like. Having the scheme administrator make specific assumptions for you doesn't truly get you anything, and may be actively misleading if you ignore what the material facts (viz., how the pension revalues and increases) are.

I'd bet a lot of money there is a very high correlation between a lazy administrator who won't do this for you, and a lazy administrator who won't give you the excess/gmp split of your pension to help work it out yourself.

That's two different things! Of course the administrator should be able to provide details of element splits, including how each revalues, their NPAs, and how they increase after NPA. They wouldn't be able to calculate the correct pension at DOR otherwise.

its very simple, they are just lazy and frankly  are skirting their statutory obligations to provide members with information about their DB pensions and get away with it. 

There is no statutory obligation to provide 'best guess' estimates at NPA. There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. At one point it looked like Pensions Dashboard would get the latter in through the back door, but that's no longer the case.

Must be pretty wild to be so confident and so incorrect

While I admire your passion, I think that's because I am correct...? It is not an ABS requirement (let alone a quasi-real time on-demand requirement); there is no specified format; and the disclosure regs only say that assumptions should be specified, not what they should be.

When Pensions Dashboard finally starts this year, providing estimated retirement income for deferred DB members will be optional - a scheme administrator could just say 'no can do', and that will be fine. If what you would like the disclosure regs to say was true now, that would make no sense. That said, I would agree it would be good if the disclosure regs were tightened. Seems a bit silly for Dashboard, once properly up and running, to include standardised DC deferred ERI figures but not DB ones. (Obviously SMPI calcs may be tenuous on various levels, but at least they are standardised for comparison purposes.)

Lemon_dr1zzle said:

I work for a LGPS fund. We never apply predicted inflation to deferred estimates. It’s got nothing to do with being lazy. 

So you provide estimates?
Estimates that use the applicable ERF or LRF for the future age?
Estimate that use the appliable CF for the future age?
Estimates that don't apply assumptions and i imagine say this in the paperwork?

And... somehow you think this is comparable to Schemes not giving anything?

LGPS administrators have been required to produce deferred annual benefit statements ever since ABSs for active members become a statutory requirement, so their position is different to that of most other schemes' administrators. However, a deferred ABS for LGPS is relatively simple given revaluation (technically pension increases from leaving) is just uncapped CPI, and GMP for post-2016 SPA cases is pretty much a non-event. So whatever future inflation you hypothecate and discount back, you'll come to the same number as just revaluing to current. 

Also - estimates (in the sense of individually requested and individually produced statements) are not the same thing as annual benefit statements.

"There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. "

This is incorrect, and is what you said, as proven by the regs shown.nobody has says there are fixed assumptions that have to be sued, but provided a NRA estimate is quite literally a legislative requirement. 

"When Pensions Dashboard finally starts this year, providing estimated retirement income for deferred DB members will be optional - a scheme administrator could just say 'no can do', and that will be fine. 

This is incorrect. It is a requirement to show estimated retirement income (for those over 100 appropriate memebrs who need to connect in the first place). Schemes have a grace period to if there benefits are particularly complex to use a simplified method, but they still haver to do that, and have to explain they are doing that.

https://www.thepensionsregulator.gov.uk/en/trustees/contributions-data-and-transfers/dashboards-guidance/information-to-provide-to-members

hyubh

Tommyjw said:

hyubh said:

Tommyjw said:

hyubh said:

Tommyjw said:

Hoenir said:

Tommyjw said:

Some DB companies are just crap at giving future projections, its such a basic request for us that i find it so odd i wouldnt believe it hapoens unless i read it on this forum, its literally no more calculated than giving a current one, just add +X% per year remaining and caveat letters with more wording about it being an estimate and you're done. 

What value is a future projection worth? Easy enough to use a calculator and compound the pension by a % increase over a number of years. Giving estimates just provides a stick to be beaten with. When the figures turn out totally different. 

Pretty impossible for figures to be "totally different" when a reasonable approach is taken.

GMP ( by and large) are guaranteed known increases, easy.

If fixed rate is used, sure. If full rate/S148 is used, no. Typically GMP will be the smaller component of the total pension either way.

Pre and post 09 statutory increases are capped at 5% and 2.5% respectively, you simple pick a reasonable assumption e.g. 2% for it all and use that. Compound wise, if you known 20 years and you're estimating the last 3  years, you could be 3% off each year and the overall end difference is marginal. Likewise, if you assume a middle ground over a longer period that will account for natural high and low inflation periods, you aren't going to be far off.

Yes, what you need to know is how the pension revalues to NPA, and if you are potentially interested in drawing it after NPA, what happens after that.

You ask what value it's worth yet lots of people want it.

Once you know the above, you can plug in whatever assumptions you like. Having the scheme administrator make specific assumptions for you doesn't truly get you anything, and may be actively misleading if you ignore what the material facts (viz., how the pension revalues and increases) are.

I'd bet a lot of money there is a very high correlation between a lazy administrator who won't do this for you, and a lazy administrator who won't give you the excess/gmp split of your pension to help work it out yourself.

That's two different things! Of course the administrator should be able to provide details of element splits, including how each revalues, their NPAs, and how they increase after NPA. They wouldn't be able to calculate the correct pension at DOR otherwise.

its very simple, they are just lazy and frankly  are skirting their statutory obligations to provide members with information about their DB pensions and get away with it. 

There is no statutory obligation to provide 'best guess' estimates at NPA. There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. At one point it looked like Pensions Dashboard would get the latter in through the back door, but that's no longer the case.

Must be pretty wild to be so confident and so incorrect

While I admire your passion, I think that's because I am correct...? It is not an ABS requirement (let alone a quasi-real time on-demand requirement); there is no specified format; and the disclosure regs only say that assumptions should be specified, not what they should be.

When Pensions Dashboard finally starts this year, providing estimated retirement income for deferred DB members will be optional - a scheme administrator could just say 'no can do', and that will be fine. If what you would like the disclosure regs to say was true now, that would make no sense. That said, I would agree it would be good if the disclosure regs were tightened. Seems a bit silly for Dashboard, once properly up and running, to include standardised DC deferred ERI figures but not DB ones. (Obviously SMPI calcs may be tenuous on various levels, but at least they are standardised for comparison purposes.)

Lemon_dr1zzle said:

I work for a LGPS fund. We never apply predicted inflation to deferred estimates. It’s got nothing to do with being lazy. 

So you provide estimates?
Estimates that use the applicable ERF or LRF for the future age?
Estimate that use the appliable CF for the future age?
Estimates that don't apply assumptions and i imagine say this in the paperwork?

And... somehow you think this is comparable to Schemes not giving anything?

LGPS administrators have been required to produce deferred annual benefit statements ever since ABSs for active members become a statutory requirement, so their position is different to that of most other schemes' administrators. However, a deferred ABS for LGPS is relatively simple given revaluation (technically pension increases from leaving) is just uncapped CPI, and GMP for post-2016 SPA cases is pretty much a non-event. So whatever future inflation you hypothecate and discount back, you'll come to the same number as just revaluing to current. 

Also - estimates (in the sense of individually requested and individually produced statements) are not the same thing as annual benefit statements.

"There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. "

This is incorrect, and is what you said, as proven by the regs shown.nobody has says there are fixed assumptions that have to be sued, but provided a NRA estimate is quite literally a legislative requirement. 

There is no annual requirement, like for active members, indeed! Follow up your own links. Sheesh, do you really think DB scheme administrators up and down the land are flouting the law by not providing annually updated benefit statements for their deferred members...?

"When Pensions Dashboard finally starts this year, providing estimated retirement income for deferred DB members will be optional - a scheme administrator could just say 'no can do', and that will be fine. 

This is incorrect. It is a requirement to show estimated retirement income (for those over 100 appropriate memebrs who need to connect in the first place). Schemes have a grace period to if there benefits are particularly complex to use a simplified method, but they still haver to do that, and have to explain they are doing that.

Check out the official Pensions Dashboard data standards if you don't believe me - if a DB administrator doesn't want to provide ERI for a deferred DB member, all they have to do is provide an ERI unavailable code that states the fact. Field ref. 2.301 if you want to look it up...

Tommyjw

hyubh said:

Tommyjw said:

hyubh said:

Tommyjw said:

hyubh said:

Tommyjw said:

Hoenir said:

Tommyjw said:

Some DB companies are just crap at giving future projections, its such a basic request for us that i find it so odd i wouldnt believe it hapoens unless i read it on this forum, its literally no more calculated than giving a current one, just add +X% per year remaining and caveat letters with more wording about it being an estimate and you're done. 

What value is a future projection worth? Easy enough to use a calculator and compound the pension by a % increase over a number of years. Giving estimates just provides a stick to be beaten with. When the figures turn out totally different. 

Pretty impossible for figures to be "totally different" when a reasonable approach is taken.

GMP ( by and large) are guaranteed known increases, easy.

If fixed rate is used, sure. If full rate/S148 is used, no. Typically GMP will be the smaller component of the total pension either way.

Pre and post 09 statutory increases are capped at 5% and 2.5% respectively, you simple pick a reasonable assumption e.g. 2% for it all and use that. Compound wise, if you known 20 years and you're estimating the last 3  years, you could be 3% off each year and the overall end difference is marginal. Likewise, if you assume a middle ground over a longer period that will account for natural high and low inflation periods, you aren't going to be far off.

Yes, what you need to know is how the pension revalues to NPA, and if you are potentially interested in drawing it after NPA, what happens after that.

You ask what value it's worth yet lots of people want it.

Once you know the above, you can plug in whatever assumptions you like. Having the scheme administrator make specific assumptions for you doesn't truly get you anything, and may be actively misleading if you ignore what the material facts (viz., how the pension revalues and increases) are.

I'd bet a lot of money there is a very high correlation between a lazy administrator who won't do this for you, and a lazy administrator who won't give you the excess/gmp split of your pension to help work it out yourself.

That's two different things! Of course the administrator should be able to provide details of element splits, including how each revalues, their NPAs, and how they increase after NPA. They wouldn't be able to calculate the correct pension at DOR otherwise.

its very simple, they are just lazy and frankly  are skirting their statutory obligations to provide members with information about their DB pensions and get away with it. 

There is no statutory obligation to provide 'best guess' estimates at NPA. There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. At one point it looked like Pensions Dashboard would get the latter in through the back door, but that's no longer the case.

Must be pretty wild to be so confident and so incorrect

While I admire your passion, I think that's because I am correct...? It is not an ABS requirement (let alone a quasi-real time on-demand requirement); there is no specified format; and the disclosure regs only say that assumptions should be specified, not what they should be.

When Pensions Dashboard finally starts this year, providing estimated retirement income for deferred DB members will be optional - a scheme administrator could just say 'no can do', and that will be fine. If what you would like the disclosure regs to say was true now, that would make no sense. That said, I would agree it would be good if the disclosure regs were tightened. Seems a bit silly for Dashboard, once properly up and running, to include standardised DC deferred ERI figures but not DB ones. (Obviously SMPI calcs may be tenuous on various levels, but at least they are standardised for comparison purposes.)

Lemon_dr1zzle said:

I work for a LGPS fund. We never apply predicted inflation to deferred estimates. It’s got nothing to do with being lazy. 

So you provide estimates?
Estimates that use the applicable ERF or LRF for the future age?
Estimate that use the appliable CF for the future age?
Estimates that don't apply assumptions and i imagine say this in the paperwork?

And... somehow you think this is comparable to Schemes not giving anything?

LGPS administrators have been required to produce deferred annual benefit statements ever since ABSs for active members become a statutory requirement, so their position is different to that of most other schemes' administrators. However, a deferred ABS for LGPS is relatively simple given revaluation (technically pension increases from leaving) is just uncapped CPI, and GMP for post-2016 SPA cases is pretty much a non-event. So whatever future inflation you hypothecate and discount back, you'll come to the same number as just revaluing to current. 

Also - estimates (in the sense of individually requested and individually produced statements) are not the same thing as annual benefit statements.

"There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. "

This is incorrect, and is what you said, as proven by the regs shown.nobody has says there are fixed assumptions that have to be sued, but provided a NRA estimate is quite literally a legislative requirement. 

There is no annual requirement, like for active members, indeed! Follow up your own links. Sheesh, do you really think DB scheme administrators up and down the land are flouting the law by not providing annually updated benefit statements for their deferred members...?

"When Pensions Dashboard finally starts this year, providing estimated retirement income for deferred DB members will be optional - a scheme administrator could just say 'no can do', and that will be fine. 

This is incorrect. It is a requirement to show estimated retirement income (for those over 100 appropriate memebrs who need to connect in the first place). Schemes have a grace period to if there benefits are particularly complex to use a simplified method, but they still haver to do that, and have to explain they are doing that.

Check out the official Pensions Dashboard data standards if you don't believe me - if a DB administrator doesn't want to provide ERI for a deferred DB member, all they have to do is provide an ERI unavailable code that states the fact. Field ref. 2.301 if you want to look it up...

Nobody said it has to be automatically done each year, you're making up arguments., What my link does say is that once per year it can be asked for and if it is it has to be provided. Which is the whole point of this conversation. 

Why are you now talking about ER?. You're words said " providing estimated retirement income for deferred DB members will be optional " . This whole conversation has been about NRA projections, which they have to provide. Do you move goalposts this much in the rest of your life or are you really that reluctant to admit you're misinformed?

This whole conversation just proves how little knowledge there is in the industry and why there are s0o many posts on this forum about certain admin companies not doing their job properly.

Secret2ndAccount

Sheesh! You guys are really getting in the weeds. All the OP wants is to know their Early Retirement Factor.
To the OP, you can see in the table you posted, that taking your pension at 60, you get 75% of what you would get at 65. That's pretty typical. Every scheme will have its own variant of these numbers. It's not going to be exactly the same as your table, and they are allowed to change it if they feel the need (before you retire, not after). But if you multiply by 1.33 you will have a decent guess at what you might receive if you wait until age 65.
Of course, nobody knows what inflation will be. It's also true that your pension is probably internally split into two or three parts, each of which might revalue at different rates. But, as a finger in the air, best guess, the revaluation table you have is fine. 
You could try asking your provider if they have a table of early retirement factors, or if they will at least give you the ERF used in calculating your estimate. That's all you need to get to the final value you seek.

hyubh

Tommyjw said:

hyubh said:

Tommyjw said:

hyubh said:

Tommyjw said:

hyubh said:

Tommyjw said:

Hoenir said:

Tommyjw said:

Some DB companies are just crap at giving future projections, its such a basic request for us that i find it so odd i wouldnt believe it hapoens unless i read it on this forum, its literally no more calculated than giving a current one, just add +X% per year remaining and caveat letters with more wording about it being an estimate and you're done. 

What value is a future projection worth? Easy enough to use a calculator and compound the pension by a % increase over a number of years. Giving estimates just provides a stick to be beaten with. When the figures turn out totally different. 

Pretty impossible for figures to be "totally different" when a reasonable approach is taken.

GMP ( by and large) are guaranteed known increases, easy.

If fixed rate is used, sure. If full rate/S148 is used, no. Typically GMP will be the smaller component of the total pension either way.

Pre and post 09 statutory increases are capped at 5% and 2.5% respectively, you simple pick a reasonable assumption e.g. 2% for it all and use that. Compound wise, if you known 20 years and you're estimating the last 3  years, you could be 3% off each year and the overall end difference is marginal. Likewise, if you assume a middle ground over a longer period that will account for natural high and low inflation periods, you aren't going to be far off.

Yes, what you need to know is how the pension revalues to NPA, and if you are potentially interested in drawing it after NPA, what happens after that.

You ask what value it's worth yet lots of people want it.

Once you know the above, you can plug in whatever assumptions you like. Having the scheme administrator make specific assumptions for you doesn't truly get you anything, and may be actively misleading if you ignore what the material facts (viz., how the pension revalues and increases) are.

I'd bet a lot of money there is a very high correlation between a lazy administrator who won't do this for you, and a lazy administrator who won't give you the excess/gmp split of your pension to help work it out yourself.

That's two different things! Of course the administrator should be able to provide details of element splits, including how each revalues, their NPAs, and how they increase after NPA. They wouldn't be able to calculate the correct pension at DOR otherwise.

its very simple, they are just lazy and frankly  are skirting their statutory obligations to provide members with information about their DB pensions and get away with it. 

There is no statutory obligation to provide 'best guess' estimates at NPA. There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. At one point it looked like Pensions Dashboard would get the latter in through the back door, but that's no longer the case.

Must be pretty wild to be so confident and so incorrect

While I admire your passion, I think that's because I am correct...? It is not an ABS requirement (let alone a quasi-real time on-demand requirement); there is no specified format; and the disclosure regs only say that assumptions should be specified, not what they should be.

When Pensions Dashboard finally starts this year, providing estimated retirement income for deferred DB members will be optional - a scheme administrator could just say 'no can do', and that will be fine. If what you would like the disclosure regs to say was true now, that would make no sense. That said, I would agree it would be good if the disclosure regs were tightened. Seems a bit silly for Dashboard, once properly up and running, to include standardised DC deferred ERI figures but not DB ones. (Obviously SMPI calcs may be tenuous on various levels, but at least they are standardised for comparison purposes.)

Lemon_dr1zzle said:

I work for a LGPS fund. We never apply predicted inflation to deferred estimates. It’s got nothing to do with being lazy. 

So you provide estimates?
Estimates that use the applicable ERF or LRF for the future age?
Estimate that use the appliable CF for the future age?
Estimates that don't apply assumptions and i imagine say this in the paperwork?

And... somehow you think this is comparable to Schemes not giving anything?

LGPS administrators have been required to produce deferred annual benefit statements ever since ABSs for active members become a statutory requirement, so their position is different to that of most other schemes' administrators. However, a deferred ABS for LGPS is relatively simple given revaluation (technically pension increases from leaving) is just uncapped CPI, and GMP for post-2016 SPA cases is pretty much a non-event. So whatever future inflation you hypothecate and discount back, you'll come to the same number as just revaluing to current. 

Also - estimates (in the sense of individually requested and individually produced statements) are not the same thing as annual benefit statements.

"There isn't even a general statutory obligation to provide deferred annual benefit statements for the pension revalued to date. "

This is incorrect, and is what you said, as proven by the regs shown.nobody has says there are fixed assumptions that have to be sued, but provided a NRA estimate is quite literally a legislative requirement. 

There is no annual requirement, like for active members, indeed! Follow up your own links. Sheesh, do you really think DB scheme administrators up and down the land are flouting the law by not providing annually updated benefit statements for their deferred members...?

"When Pensions Dashboard finally starts this year, providing estimated retirement income for deferred DB members will be optional - a scheme administrator could just say 'no can do', and that will be fine. 

This is incorrect. It is a requirement to show estimated retirement income (for those over 100 appropriate memebrs who need to connect in the first place). Schemes have a grace period to if there benefits are particularly complex to use a simplified method, but they still haver to do that, and have to explain they are doing that.

Check out the official Pensions Dashboard data standards if you don't believe me - if a DB administrator doesn't want to provide ERI for a deferred DB member, all they have to do is provide an ERI unavailable code that states the fact. Field ref. 2.301 if you want to look it up...

Nobody said it has to be automatically done each year, you're making up arguments., What my link does say is that once per year it can be asked for and if it is it has to be provided. Which is the whole point of this conversation. 

Why are you now talking about ER?. You're words said " providing estimated retirement income for deferred DB members will be optional " . This whole conversation has been about NRA projections, which they have to provide. Do you move goalposts this much in the rest of your life or are you really that reluctant to admit you're misinformed?

This whole conversation just proves how little knowledge there is in the industry and why there are s0o many posts on this forum about certain admin companies not doing their job properly.

What can I say, I appreciate the enthusiasm. Not a common thing in DB admin land...!