Pension Transfer Value (CETV) Estimator

How the actuary arrives at a multiple

The scheme actuary calculates your CETV by starting with your accrued annual pension — the guaranteed income you have already built up — and applying a multiplier to convert that annual income into a single capital sum. That multiplier is not a fixed, published number; it is derived from a set of actuarial assumptions that the actuary reviews and updates periodically, reflecting current financial and demographic conditions.

Three assumptions do most of the work. First, your age: the multiplier is generally higher for younger members, because their pension will not be paid for many more years, giving the notional invested capital longer to be assumed to grow before payments begin, and because they have more years of life expectancy over which payments are assumed to be made once they start. Second, assumed future investment returns: the actuary has to assume what rate of return a notional fund would need to earn to replicate the guaranteed pension income, and this is closely tied to prevailing gilt yields — when gilt yields are low, a larger capital sum is needed to replicate a given income, which pushes multiples up, and when yields rise, multiples tend to fall. Third, inflation and mortality assumptions: because your PPS 2015 pension is guaranteed to rise with CPI+1.25% and paid for as long as you live, the actuary must build in assumptions about future inflation and about how long you and your dependants are expected to live, both of which are periodically revised as national mortality and economic data are updated.

Because all three of these assumptions shift over time — sometimes significantly, as seen in periods of sharp gilt yield movement — the multiple that applies to a given pension can vary considerably between individuals of different ages and between different points in time for the same individual. This is why this calculator lets you adjust the multiplier within a realistic range (roughly 18x to 30x for a scheme like PPS 2015) rather than presenting a single fixed figure: your own official CETV, calculated by the scheme actuary at a specific date, may sit anywhere within or even outside that range depending on your personal circumstances and prevailing conditions at the time.

Worked example: from pensionable pay to accrued pension to CETV

To see how the pieces fit together, take an officer with 15 years of pensionable service and an average revalued pensionable pay across those years equivalent to £45,000. Under PPS 2015's CARE structure, each year of service adds 1/55.3 of that year's pensionable pay to the pension pot, with each year's slice then revalued by CPI+1.25% in every subsequent year. For simplicity, if we treat the £45,000 figure as already representing the revalued value of all 15 years combined, the table below shows how that translates into an accrued pension and an estimated CETV at each end of the typical multiplier range.

This roughly £73,000 difference between the two ends of a realistic multiplier range, for exactly the same accrued pension, illustrates why the multiplier matters so much and why only an official, scheme-calculated figure — not an estimate using an assumed multiplier — can be relied on for any real decision. Real CETV calculations are also more involved than this simplified example, typically factoring in service accrued under transitional protection arrangements from the legacy pension schemes for officers who moved across during the 2015 reforms, which this calculator does not attempt to model.

The £30,000 mandatory advice threshold

Any transfer of pension benefits worth £30,000 or more from a defined benefit scheme — which includes PPS 2015 — cannot legally proceed unless the member has first received regulated advice from a pension transfer specialist authorised by the Financial Conduct Authority (FCA). This is not optional guidance; it is a statutory requirement, and most receiving schemes will simply refuse to accept the transfer without written confirmation that this advice has been obtained. Given that even relatively modest accrued PPS 2015 pensions can produce CETVs well above £30,000, as the worked example above shows, this threshold applies to the great majority of officers who might consider a transfer.

This requirement exists because of a well-documented history of poor outcomes when members of guaranteed defined benefit schemes have transferred out without adequate independent advice, most prominently the British Steel Pension Scheme transfer scandal, where thousands of members were persuaded — in some cases by unregulated or poorly regulated advisers working on commission — to give up secure, inflation-linked pensions for transfers that turned out to be unsuitable, exposing them to investment risk, higher ongoing charges, and in many cases a materially worse retirement outcome than staying in their defined benefit scheme would have delivered. The £30,000 advice requirement, and the wider FCA regulatory framework around pension transfer advice that followed, exists specifically to prevent similar harm to members of other guaranteed schemes, including public sector schemes like PPS 2015.

Why the guaranteed CARE pension is rarely beaten by a transfer

It is worth being direct about this, while stressing that this is general information rather than advice on any individual's specific circumstances: for the great majority of serving officers, transferring out of PPS 2015 into a defined contribution arrangement is very unlikely to leave them better off in retirement. The reasons are structural, not a matter of investment skill or luck. PPS 2015 provides a guaranteed income for life, automatically rising with CPI+1.25% every year, which is extremely difficult and expensive to replicate through a self-managed drawdown pot exposed to investment markets — a transferred pot has to both generate returns and last for an unknown lifespan, with no guarantee against running out or against a poor sequence of investment returns in the years just before or after retirement.

On top of the guaranteed, inflation-proofed income itself, a transfer also gives up the employer subsidy built into PPS 2015 — the employer contributes 35.3% of pensionable pay towards the scheme, dwarfing typical private sector pension contributions, and this ongoing subsidy has no direct equivalent once benefits are transferred out. Officers also give up valuable protections that come bundled with the scheme: death-in-service benefits for dependants, and ill-health retirement provisions that can provide an enhanced pension if an officer is forced to leave the service early due to injury or illness — both extremely difficult and expensive to replace privately. Taken together, these features mean that for a transfer to genuinely leave an officer better off, the transferred pot would typically need to sustain investment returns, over a long period and including the drawdown years, well beyond what most FCA-regulated advisers would consider realistic to plan around — which is precisely why the great majority of regulated pension transfer advice for schemes like this concludes that transferring is not in the member's interest.

Legitimate reasons to consider a transfer, and reasons to be cautious

None of this means a transfer is never appropriate. There are a small number of genuinely legitimate circumstances where transferring, or at least seriously investigating it with proper advice, can make sense. Pension sharing on divorce is one: a court-ordered pension sharing arrangement may require part of an officer's pension to be transferred to an ex-spouse's own pension arrangement, which is a different situation from a voluntary transfer decision and follows its own legal process. Consolidating service from a genuinely comparable public sector defined benefit scheme — for example, transferring pension rights from a previous role in another public sector CARE or final-salary scheme into PPS 2015, or vice versa when leaving the police service for another public sector employer — can also be worth exploring, since this keeps benefits within a broadly similar guaranteed framework rather than exchanging a defined benefit promise for market-exposed drawdown, though even scheme-to-scheme transfers of this kind still need to be checked carefully against the specific terms of both schemes.

By contrast, there are some clear warning signs that should prompt real caution before proceeding. Anyone seriously considering a transfer should approach it only through an FCA-authorised pension transfer specialist that they have sought out independently, verify that adviser's registration directly on the FCA register, and treat the process as a serious, one-way decision that deserves proper, independent, regulated advice — not as a calculation to be made from an online estimate. This calculator, like the rest of this site, is provided for general information and illustration only, and nothing here should be taken as personal financial advice or as a recommendation to transfer or not to transfer.

Getting an official, guaranteed figure

The estimate this calculator produces is useful for understanding the broad scale of your accrued benefits and how sensitive a transfer value is to the multiplier applied, but it cannot substitute for an official CETV, which only your scheme administrator can issue. An official statement is calculated using your exact service record and the specific actuarial factors in force at the date of calculation, and it comes with a guarantee period, typically around three months, during which the figure is locked in regardless of any market movements or assumption changes in the meantime. Outside that guarantee window, a fresh calculation can produce a noticeably different figure, particularly if gilt yields or mortality assumptions have shifted since the previous statement was issued.

Most officers are entitled to request one official CETV statement free of charge in any twelve-month period, with a further administrative charge sometimes applying to additional requests within the same period, though the exact policy is set by the scheme administrator rather than by individual forces. If you are seriously considering a transfer, the right first step is to request this official statement in writing, and to begin the FCA-regulated advice process well within the guarantee window, since the advice process itself — covering your full financial circumstances, objectives, and risk tolerance, not just the transfer figure — typically takes longer than officers initially expect.

A note on how this calculator should and should not be used

This tool is designed to help you understand the mechanics behind a CETV — how an accrued pension is calculated, and how sensitive the resulting transfer value is to the multiplier applied — using illustrative figures based on the information you enter. It deliberately avoids producing a single definitive number presented as your actual transfer value, because no online calculator, including this one, has access to the precise actuarial factors, exact service record, and scheme-specific rules that only your pension administrator holds. Use it to build an intuitive understanding of the scale of figures involved and the trade-offs at stake, and treat any figure it produces as a starting point for a conversation with your scheme administrator and, where the £30,000 threshold applies, a regulated pension transfer specialist — never as a substitute for either.