# SCSB calculation; lump sum pension entitlement



## Kemo_Sabe (8 Mar 2010)

I have been informed that I will be made redundant next summer (office closing down).

We're currently in a consultation phase with the employer and they are offering me a bonus to stay on until the office closes (in order to facilitate an orderly wind-down of the company), plus a lump sum upon redundancy. This redundancy lump sum is quite low by industry standards - works out at about 2 weeks per year of service.

However, I believe it would be preferable to receive this bonus as part of my redundancy lump sum - it would also cost my employer less as they wouldn't have to pay PRSI on it. So there's a possible win\win situation here. I've been asked to run the numbers on this.

I'm looking at the SCSB calculation for redundancy lump sums and fully understand the (average salary/3) * years of service/15 part of the equation. The bit I have difficulty understanding is the pension lump sum amount that must be subtracted.

I've been a member of the staff DC scheme since I joined here. The employer makes 5% contribution. The current value of my fund is about €100k. I'm only in my 30s so would obviously not be retiring any time soon.

How do I calculate the lump sum value of this fund? Is it an easy x% number? Is it a Net Present Value type calculation?

Obviously it would be in my best interest if this lump-sum value could be as small as possible. Can anyone point me in the right direction as to how I would calculate this number?


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## Barney Magoo (9 Mar 2010)

As far as I know the calculation of pension lump sum used in the SCSB comes not from you but from the pension provider/administrator based on an actuarial calculation. It is in effect a net present value calculation based on your current and projected fund value, age, retirement age, etc. 
I'd speak to your employer and pension administrator for clarification.


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## Kemo_Sabe (12 Mar 2010)

Barney Magoo said:


> As far as I know the calculation of pension lump sum used in the SCSB comes not from you but from the pension provider/administrator based on an actuarial calculation. It is in effect a net present value calculation based on your current and projected fund value, age, retirement age, etc.
> I'd speak to your employer and pension administrator for clarification.


 
thanks, I got this done and with the PV discount applied, it comes to a pleasingly small number


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