How much will my pension be?

FROM: Dr R.J.Appleton

What NEED does this meet?
People with personal (defined contribution) pensions who want to find out how much to save to achieve a level of income.

What is the APPROACH?

Approach is to get state pension amounts (from Dept of Work & Pensions site - very hard to find figures for state pension amounts) and average annuity rates from FSA tables (www.fsa.gov.uk) for projected pension pot and calculate

What are the BENEFITS to people?
It is hard to get a siomple answer to 'how much can I expect to get when I retire?' if you have a defined contribution pension plan. Projections by pension providers talk about how big a 'pot' one will ahve at 55, 60 or 65 but do not relate that to monthly or annual income (as that requires annuity rates).

Although one cannot forecast with accuracy tying up a pension pot with annuity rates (with various other bits of data such as spouse's pension, retirment ages ofn 55,60,65, income level or linked to RPI, etc) will give a lot more idea to people about what they can expect to retire on. This will help with decisions regarding levels of contribution. (Current annuity rates are low, so currently this approach is likely to underestimate the pension income).

What is the COMPETITION?
Don't know of any place to get this as a consolidated view across state and annuity providers.

What BUDGET & LOGISTICS are required?
Failrly simple, although an annual update may be required to state pension figures as DofW&P only keep these in a PDF file (making it hard to prase automatically).

I have manually obtained average annuity rates from FSA by repeatedly filling in their query form, and averaging out the projected monthly pension amounts in the response table.