# pension calculation



## showmethemoney45 (Feb 27, 2015)

I notice people put their pension into their net worth. How is this calculated actually? My husband's says $67/100 hours of service which only works out to roughly 20000. This seems low for 13 years of service.

Thanks


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## GreatLaker (Mar 23, 2014)

*Commuted Value*

Is it a DB pension? If you get an annual pension statement there should be a number in it for the *commuted value*.

You can also calculate it based on the net present value of the future pension payments. Excel's NPV formula can be used.

There is a thread on FWF on calculating it:
Present value calculation for DB pension... am I doing it right?


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## peterk (May 16, 2010)

I believe that $67/100 of service is probably the *per year* pension payment that he would receive at the age of 65. That seems more realistic for someone with 13 years service with a very high salary.

Remember also that most likely overtime hours do NOT count towards the pension entitlement (It's possible it does, but unlikely).

Your best bet is to ask his benefits department to calculate his Commuted Value.


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## showmethemoney45 (Feb 27, 2015)

His OT hours are definitely pensionable hours. We confirmed as he works a good deal of OT.


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