If you are funding (?) for just an additional 50% Spouses pension (only payable in the event of the retired member pre-deceasing his/her spouse) I cannot see how that might be "several hundred thousand euro".Several hundred thousand euro.
Not all DB pensions are equal. The level of additional funding leeway will vary depending on the level of benefits payable under the main scheme. I recall from a previous post that you are in a PS Class A PRSI scheme. There is loads of scope for AVC funding there.I was concerned with overfunding through avc. I am on db pension. I was kindly advised that it nearly impossible to overfund in my position.
Who does or how is the calculation made? Class D PRSI..I was concerned with overfunding through avc. I am on db pension. I was kindly advised that it nearly impossible to overfund in my position.
this allows me to invest through my avc and it can grow tax free until I put it into an ARF on retirement.
If you are a Pre1995 Class D with likely full service, then you occupational pension will give you:Who does or how is the calculation made? Class D PRSI..
I'm class A PRSIWho does or how is the calculation made? Class D PRSI..
You are funding for the possibility of payment for a widows or widowers pension.
A single worker can fund because of the possibility of marriage later in life.
Ok, so how do you calculate how much AVCs you can fund for the possibility of providing a Spouses Pension, which might or might not actually arise? Even if you are married coming up to retirement, how do you FUND for a contingent benefit? What’s the calculation model?You are funding for the possibility of payment for a widows or widowers pension.
A single worker can fund because of the possibility of marriage later in life.
But the Spouses Pension only arises on the members death in retirement IF the spouse is still alive. That might never arise. The Spouses Pension is not a pension payable in addition to the Member Pension.Pension shortfall 15000 euro per year.
Spouse age 60.
Lifespan 30 years.
You are the pension expert. You work it out.
Even if that were correct, what’s the multiplier of €15,000 for such a contingent benefit? And if at retirement, both the couple are still alive (so your AVC fund is not being used to provide a Spouses Pension at that time) but the AVC fund is tranferred to an ARF, the resulting compulsory drawdown (4% or 5%) is drawn down by the member (not the Spouse) and could result in a total pension income in excess of Revenue limits. How is that allowable under Revenue max benefits?As I have said many times the AVCs are allowable to fund for a possibility.
If the possible event does not arise the AVCs can be used as desired by the holder.
Agreed. And in the case of a large group scheme, an actuarial calculation can be made as to the volume of possible Spouses Pensions (payable only on the members death in retirement leaving a surviving spouse) and the resulting funding cost. But in an individual case (even where the member is a member of a large group scheme) I cannot see how they can FUND for a benefit that might never arise, without potentially exceeding Revenue limits if the event never happens (ie the member does outlive their spouse).A pension may fund for a possibility. But does the cost of that possibility not have to quantified and taken into account in relation to the overall Revenue pension limits? For example, if there is to be a death benefit payable after retirement I understand that this has to be accounted for by referring to the equivalent cost of a single payment life insurance policy for that age group.
The Revised Scheme (post-1984, but members of the older scheme had a transfer option) provides for a survivor pension in the event of marriage after retirement. I cannot confirm but I assume this would also cover the above possibility. (It must make elderly single PS retirees quite attractive. An unfunded benefit!)Possibility....
Member outlives spouse and them remarries
They should be so lucky.Possibility....
Member outlives spouse and them remarries.