The commuted value of a pension benefit refers to the amount of money that needs to be set aside today, at current market interest rates, to provide sufficient funds to pay for a pension when a plan member retires, i.e., how much a benefit is worth today. Commuted values express the lump sum value of a promised benefit, usually from a defined benefit pension plan. The commuted value takes into account the benefits, interest and mortality. The lower the current interest rates, the higher the commuted value will be, because it is assumed that the amount today will earn less from now until retirement; and, conversely, the higher the current interest rates, the lower the commuted value.
In Canada, the present value of the pension benefits expected to be paid to a retiree from the date of retirement until death.----------[ Back
The equivalent value of a future series of payments, paid immediately as a lump sum.
The lump sum value equivalent to your earned pension, calculated in accordance with procedures prescribed by the pension legislation.
Amount of a lump sum payment estimated to be equal in value to a pension or a benefit.
The commuted value of a member's pension is the estimated amount of money HOOPP needs now to pay the member's pension in retirement, based on the member's service and earnings to date. The commuted value fluctuates with changes in factors such as the member's age and interest rates.
This is an amount that is calculated using actuarial methods to produce a present value that, if invested at a certain rate of interest until your retirement, will provide enough money to purchase an annuity in the same amount as the pension that you accrued under the Defined Benefit plan.
The amount of an immediate lump-sum payment estimated to be equal in value to a future series of payments.
The amount of money paid in a lump sum that is equal in value to your future pension payments, as determined by the plan actuary on the basis applicable to benefits payable under the Overcap Pension Plan.
What a Member's deferred pension is worth today in a lump sum. Also known as Actuarial Present Value.
The present value of a series of future installment payments, primarily used in the context of settlement options.
The actuarial present value of a deferred pension calculated at the employee's termination date.
