What is the Investment Return used to calculate Commuted Value?

7351 Views 11 Replies 3 Participants Last post by Saniokca, Oct 27, 2009

Eric

Discussion Starter · Oct 22, 2009

I have the spreadsheet to calculate Commuted Value of a pension, however I wonder what is the "official" Investment Return that should be used.

I presume an employer cannot just use his own estimate. I would think that there is some official value that employers must use. Right?

Is there a web site that give the current official value?

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Saniokca

· #12 · Oct 27, 2009

Eric said:
Thank you for the info. I appreciate the time you take to dig this information out. I am 66, so I presume that they will use a life expectancy of much more than 83. This is good news.

With the low rates, the indexing and the bigger life expectancy, I think I will get over the $400k limit, despite the 31% Nortel drop. This will complicate my decision. I wonder if I can put $400k in a locked-in plan and the rest in an annuity - I don't think I can do that. The limit on the contribution to a locked-in plan is strange. Why do they care?

As the person above said this - it's taxes. The government wants it's share. And it's is pretty much for the same reason as having a limit on RRSP contributions... Unfortunatelly for you, the excess will be fully taxed.

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