Not a penny more not a penny less

Not a penny more, not a penny less – problems with transfer values Clare Hobro Younger Members’ Convention 1 -2 December 2003 The Glasgow Moat House

Slides for prior publication on website • Note these slides say hardly anything, as I am expecting a everyone to contribute ideas and debate during the session. Hewitt Associates 2 [Doc. ID]

What is a pension transfer value? • Hewitt Associates Your ideas please! 3 [Doc. ID]

Who cares how much it is? Hewitt Associates 4 [Doc. ID]

Pension, lovely pension, how much will you give me for this prime pension? • Hewitt Associates What transfer amount would be fair? 5 [Doc. ID]

What if scheme is underfunded? Hewitt Associates • Is it fair to pay full TV? • If not fair, what would you do? 6 [Doc. ID]

What data is needed Hewitt Associates 7 [Doc. ID]

Men are from Mars, women are from Venus • So should their transfer values be different? • What about young and old? Hewitt Associates 8 [Doc. ID]

How much is your pension worth? Hewitt Associates • Peanuts? • More than your house? • More than your car? 9 [Doc. ID]

So what do the figures look like? £ 5, 000 pension at leaving date Age 55, left at 30, retiring at 60? Age 30, leaving now, retiring 65, scheme 90% funded? Hewitt Associates 10 [Doc. ID]

Too high, too low? Hewitt Associates • TVs were generally calculated as …. • This was too low. Why? . . . • This was too high. Why? . . . • The big pensions lock in …. . 11 [Doc. ID]

Legislation and guidance says…. . Hewitt Associates 12 [Doc. ID]

Would you accept this transfer value? • Age 55, left at 30, retiring at 60 • Age 30, leaving now, retiring 65 • As above but underfunded Why put all your eggs into one basket anyway? And what are you moving to • defined contribution? – taking more risk • defined benefit – how do receiving scheme transfer in terms compare to your TV? Hewitt Associates 13 [Doc. ID]

Thank you! Clare Hobro 2 December 2003 Younger Member’s Convention Clare. Hobro@Hewitt. Bacon. Woodrow. com Hewitt Associates 14 [Doc. ID]