I have two pension schemes from two different UK major providers, and they are presumably using whatever the legal requirements are for calculating projected annuity for my pot, but to me they seem exceptionally conservative.
Basically, both companies' statements say at retirement age of 65 they project my value to be (my rounding) £100,000, giving an annuity of about £3,000. To my untrained eye, assuming zero effective growth, this looks like they are projecting I live to around 95 years old, which whilst desirable is way above the expected average. Furthermore, they state that they are projecting on inflation of 2.5% (I presume the annuity payout would grow by this amount per year?) and a fund growth of 4.5%, so the funds backing my annuity should be growing by 2% (minus fees) per year.
How are these figures arrived at? Are they deliberately (by law?) pessimistic or am I missing something in my simplistic calculations.