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6. A company is about to establish a pension scheme that will provide retirement benefits to its members of n/60ths of final pensionable salary at

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6. A company is about to establish a pension scheme that will provide retirement benefits to its members of n/60ths of final pensionable salary at age 65 or on earlier ill health, where n is the total number of years of service to retirement. Age retirement in normal health follows the principles in the Pension Scheme Table for age retirement functions in the Formulae and Tables for Actuarial Examinations. Final pensionable salary is the average salary in the three years before retirement. An employee joins the scheme aged 40 exact and is granted exactly 15 years of past service. The employee's salary in the year before aged 40 was 50,000. Based on Pension Scheme from the Formulae and Tables: (a) Calculate the total present value of retirement and ill health benefits for this member (including past service and future service). (7 marks) (b) Calculate the contribution required, as a percentage of future salary, to fund this benefit. (3 marks) 6. A company is about to establish a pension scheme that will provide retirement benefits to its members of n/60ths of final pensionable salary at age 65 or on earlier ill health, where n is the total number of years of service to retirement. Age retirement in normal health follows the principles in the Pension Scheme Table for age retirement functions in the Formulae and Tables for Actuarial Examinations. Final pensionable salary is the average salary in the three years before retirement. An employee joins the scheme aged 40 exact and is granted exactly 15 years of past service. The employee's salary in the year before aged 40 was 50,000. Based on Pension Scheme from the Formulae and Tables: (a) Calculate the total present value of retirement and ill health benefits for this member (including past service and future service). (7 marks) (b) Calculate the contribution required, as a percentage of future salary, to fund this benefit

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