How to calculate pension value?

[Anonymous]

Anonymous wrote:A very rough estimate: your annual pension at age 58 is $78K. The present value of a $1 annuity at that age is somewhere around 20. So, at age 58, the value will be $78K x 20 =$1.56M. Discounts it back 17 years to now, at 4%, it’s about $800K.

An actuary.

There is no guarantee you will make it to 78 years of age. Why are you trying to value this when tomorrow is not promised. It's not like a 401 or IRA that is inheritable.

[Anonymous]

OP trying to figure out net worth lame

[Anonymous]

Anonymous wrote:

Anonymous wrote:A very rough estimate: your annual pension at age 58 is $78K. The present value of a $1 annuity at that age is somewhere around 20. So, at age 58, the value will be $78K x 20 =$1.56M. Discounts it back 17 years to now, at 4%, it’s about $800K.

An actuary.

There is no guarantee you will make it to 78 years of age. Why are you trying to value this when tomorrow is not promised. It's not like a 401 or IRA that is inheritable.

Because I am an actuary.

[Anonymous]

Anonymous wrote:Why do you need to know your pension value for retirement planning? You don't need to know the value of your social security for example. All that matters is what you can expect to receive monthly from your pension, social security or other sources. Sounds to me like you want to count the value in your net worth, which is kind of pathetic.

I agree: You are going at this backwards. The goal is to have enough income in retirement, so you want to start with your pension and Social Security monthly benefits. Then take your assets and figure out how much income they will provide, and add that. To get a very rough idea of the income that assets will provide, you can start with the 4 percent rule, but you'll want to refine it (https://www.schwab.com/learn/story/beyond-4-rule-how-much-can-you-spend-retirement)

[Anonymous]

You don't calculate your pension value. That's not a thing.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:A very rough estimate: your annual pension at age 58 is $78K. The present value of a $1 annuity at that age is somewhere around 20. So, at age 58, the value will be $78K x 20 =$1.56M. Discounts it back 17 years to now, at 4%, it’s about $800K.

An actuary.

There is no guarantee you will make it to 78 years of age. Why are you trying to value this when tomorrow is not promised. It's not like a 401 or IRA that is inheritable.

Because I am an actuary.

People are talking to OP, not you.

[Anonymous]

Op - ok thanks I think this all makes more sense. No need to figure out actual value of pension. Just need to calculate amount of pension plus social security and any other source income at time of retirement.

[Anonymous]

I asked chat got and it did a pretty good job estimating the net present value of my pension.

[Anonymous]

Anonymous wrote:Op - ok thanks I think this all makes more sense. No need to figure out actual value of pension. Just need to calculate amount of pension plus social security and any other source income at time of retirement.

Thanks for wasting our time

[Anonymous]

Anonymous wrote:You don't calculate your pension value. That's not a thing.

It is a thing. Here is an article on how to do it:

https://andrewmarshallfinancial.com/what-is-a-pension-worth/

Some pensions you can leave to heirs other than your spouse. Those definitely do get valued for purposes of determining whether and the extent to which the federal or state government will tax the estate.

[Anonymous]

You don’t factor it into net worth and that is what dodo OP is attempting to do

[Anonymous]

Guessing OP is the author of the net worth post. Lame.

[Anonymous]

Anonymous wrote:Pensions are very valuable.
If ever divorcing, you are entitled to half of your spouse's pension via QDRO. This is an income stream for LIFE. Don't give it up.
Also, don't let his/her lawyer tell you it's only worth $thousands, when it's really worth $1-$2 million.
Don't give it up.
Don't take an undervalued buyout.
It also often has healthcare benefits or death payout attached. Don't give it up.

+1. I made sure to keep my pension when I divorced last year. Her lawyer was too stupid not my fault.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Why do you need to know your pension value for retirement planning? You don't need to know the value of your social security for example. All that matters is what you can expect to receive monthly from your pension, social security or other sources. Sounds to me like you want to count the value in your net worth, which is kind of pathetic.

+1

Plus many do not get inherited when you pass or at most only to a spouse

They can inherit his Roth and investments in taxable

[Anonymous]

Anonymous wrote:

Anonymous wrote:A very rough estimate: your annual pension at age 58 is $78K. The present value of a $1 annuity at that age is somewhere around 20. So, at age 58, the value will be $78K x 20 =$1.56M. Discounts it back 17 years to now, at 4%, it’s about $800K.

An actuary.

There is no guarantee you will make it to 78 years of age. Why are you trying to value this when tomorrow is not promised. It's not like a 401 or IRA that is inheritable.

So many haters lol