Modeller

Important information

The modellers carry out calculations based on the data which you input and assumptions about the future such as inflation rates and investment returns. None of us can predict the future, so please remember that the results shown by the modellers do not guarantee any future outcome. Please note that the modellers are for illustrative purposes only. Your actual pension from the Metal Box Pension Scheme will almost certainly differ from the estimated figures shown.

How the modeller works

The pension modeller bases calculations upon the personal data you enter. You can find all the data you need on your annual benefit statement.

The modeller allows you to include the additional benefits you could purchase in the Scheme if the DC switchback option is available to you, i.e. you previously had savings in the Metal Box AVC Plan which were transferred to The Aon MasterTrust in July 2019.

The terms used for this conversion are set in relation to investment market conditions at your chosen retirement date and vary over time. As these are currently unknown the modeller bases the calculations on market conditions as at 31 March 2020.

The modeller assumes that any tax-free cash lump sum you take at retirement is paid from DC switchback savings first and then part of your DB pension is exchanged to provide further cash, if necessary.

The modeller assumes that any DC switchback savings that are not taken as cash are converted to either a single-life or joint-life pension based on the choice you make in the modellers.

Purpose and limitations

The modeller has been developed for the specific purposes of providing you with a tool to model your retirement benefits from the Scheme. Whilst considerable effort has been made to validate the calculations used, the accuracy of the calculations cannot be guaranteed in all circumstances. You may wish to consult with an Independent Financial Adviser before taking any action on the basis of the illustrations provided by these tools.

General assumptions

• All amounts are shown in terms of today’s prices by stripping out the effect of assumed future retail price inflation (see below).
• Pension amounts do not allow for income tax.
• Your State Pension is not included in the figures illustrated in the modeller. For more information about the State Pension, visit www.gov.uk/new-state-pension.
• Tax thresholds, rates and personal allowances are based on the UK figures for the tax year 2020/2021.
• The Lifetime Allowance is based on the UK figure for the tax year 2020/2021 of £1,073,100.
• The modeller uses the following default assumptions:
  • Future annual retail price inflation (RPI) of 2.5% a year until you retire.
  • Investment growth of 6% a year (before inflation). This assumed rate is not likely to reflect the actual performance. You can choose to set your own investment growth from -1% to 10%. The figure you select should be considered to be net of expenses.

Pension forecast

The actual amount of pension you receive at retirement may be higher or lower than the figures shown by the pension modeller, as it will depend on many factors. These include the actual performance of your investments in The Aon MasterTrust available for DC switchback and the Scheme’s factors used to calculate benefits that are in force when you retire (which are reviewed and revised from time to time).

For DC switchback, the cost of buying a pension is calculated using the Scheme's current conversion terms (based on market conditions at 31 March 2020).

General notes

The pension modellers are intended for illustrative purposes only and its results do not constitute a promise or guarantee of the benefits you will receive or that a particular level or rate of contributions or benefits will continue unchanged. The pension modellers should be used in conjunction with other available communications and not as the sole source of information when making decisions about your pension arrangements.

All modeller results are shown in terms of today’s prices. The graphical display is not an accurate representation of the figures. It is simply an indication of the relationship between the different contribution levels, salary and investment growth, tax-free cash lump sum and retirement age.

Any choices you make or data that you enter while using the modellers are erased once you have finished using the modellers.

HM Revenue & Customs rules

Your final pension and any cash lump sum you may take are subject to HM Revenue & Customs (HMRC) rules. Accumulated funds above the Lifetime Allowance (£1,073,100 for 2020/2021) will be subject to high levels of taxation.

You may wish to seek advice if you believe it is likely you will be affected by the above.

If you require any further information, please contact Equiniti.