I’m a deferred member of a defined benefit pension scheme (left service 6 years ago). I’m 61 years old with a scheme retirement age of 65.
The deferred pension is €23,078pa with a widows pension of two thirds. The current transfer value is €493,000. The benefit is indexed linked at CPI to retirement age.
The transfer value has appreciated significantly over the 6 years and I suspect any increase in TV by remaining in the scheme would out strip any investment growth I could get via a retirement bond over the next 3+ years – assuming the scheme remains in a sound financial position.
I was quite happy to remain in the scheme until recently. However, the most recent valuation I got seems to contain a lot more caveats like “the amount shown is not guaranteed”, “the trustees reserve the right to reduce/suspend”, “values are subject to ongoing review particularly in light of recent market trends” etc etc.
The scheme was fully funded as of the last valuation date of December 2017. The next valuation I understand is December 2020 (every 3 years). And likely another 6 to 8 months after that before those details become available.
Given that the scheme was fully funded last time it was valued in 2017 but the next valuation isn’t for another 6 months is there any way of knowing if the scheme’s financial position has disimproved?
If benefits were to be reduced before I reach 65 is there any way of determining how dramatic that reduction is likely to be?
If there is a reduction in benefits and accordingly the transfer value, would the drop be such that it still might make sense to remain in the scheme versus a conservative investment strategy in a retirement bond?
In an ideal world I intended to remain in the scheme until just before retirement age and decide at that point whether to take the deferred pension of transfer out and invest in an ARF.
The deferred pension is €23,078pa with a widows pension of two thirds. The current transfer value is €493,000. The benefit is indexed linked at CPI to retirement age.
The transfer value has appreciated significantly over the 6 years and I suspect any increase in TV by remaining in the scheme would out strip any investment growth I could get via a retirement bond over the next 3+ years – assuming the scheme remains in a sound financial position.
I was quite happy to remain in the scheme until recently. However, the most recent valuation I got seems to contain a lot more caveats like “the amount shown is not guaranteed”, “the trustees reserve the right to reduce/suspend”, “values are subject to ongoing review particularly in light of recent market trends” etc etc.
The scheme was fully funded as of the last valuation date of December 2017. The next valuation I understand is December 2020 (every 3 years). And likely another 6 to 8 months after that before those details become available.
Given that the scheme was fully funded last time it was valued in 2017 but the next valuation isn’t for another 6 months is there any way of knowing if the scheme’s financial position has disimproved?
If benefits were to be reduced before I reach 65 is there any way of determining how dramatic that reduction is likely to be?
If there is a reduction in benefits and accordingly the transfer value, would the drop be such that it still might make sense to remain in the scheme versus a conservative investment strategy in a retirement bond?
In an ideal world I intended to remain in the scheme until just before retirement age and decide at that point whether to take the deferred pension of transfer out and invest in an ARF.