State Pension in future value

Q. How do I show the state pension in future value?

 

A. In Voyant, the State Pension is set to escalate by the National Average Earnings (NAE) rate set in Preferences, as we anticipate that the state pension forecast is usually quoted in 'present value' terms, meaning that it is expected to be inflated between now and the time at which it will be paid.

If you have a State Pension forecast quoted in 'future value' terms, i.e. it is the actual amount that will be received, you will need to amend the assumed rate for NAE in Preferences for the plan you are working in (under Preferences > Plan Preferences > Default Inflation/Growth Rates) to 0%. Please ensure you click the Apply button in the bottom right of the screen to save the change.

Alongside the escalation of State Pension, however, changing the assumed rate for NAE will also change the rate at which employment income is assumed to increase. You will, therefore, also need to go to the Employment screen, select the employment income from the ledger, expand Advanced Settings > Growth, and enter the relevant rate of increase for that income source. Repeat for all employed income.