....The problem is how the transfer value is calculated. It uses completely unrealistic assumptions to come up with a figure that is supposed to provide you with the benefit that you are giving up. ....
....I do know it assumes a net growth rate of 7% and an annuity rate of 4.5%. Both completely unrealistic.
Are there not influential lobby groups putting pressure on the actuarial society (or whoever may be more appropriate) to wake up and smell the coffee ?
Yes, when the scheme is wound up, it moves to defined contribution and you can access your fund then. If you go the 150% final salary route, you must purchase an annuity with the remainder, the ARF option is not available to that tax free lump sum choice (you must take 25% tax free lump sum for the ARF).
If it is 125%, it is good, meaning there is surplus in the fund. But 100% funding level is a long way below actually meeting the actual cost of providing with the benefits the scheme says it will. It's all been a ponzi scheme where the continued addition of younger members paid for the pensions of older members.
Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)
However do consider whether the option to take up to 150% of Salary as a lump sum (and buy an Annuity with the balance) might be a better option. Depending on the size of the fund and your salary this might give you a much higher tax free lump sum.
...Poor annuity rates and the fact that the policy dies with you are the main factors for people avoiding annuities.
Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)
My point about the 150 per cent is that it might be possible to get most of the funds tax free, depending on size of funds and salary/service.
- long past time the rules were changed, with regards to transfer of an annuity on death. I know it cannot be let run forever, but the current arrangements are simply wrong.
Good grief....Logan's Run anyone?those who live too long
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