For a DB plan, calculate and interpret the actuarial accrued liability and the normal cost for benefits payable on age retirement or early exit using the projected unit credit (PUC) and traditional unit credit (TUC) valuation methods.
Free SOA Exam ALTAM (Advanced Long-Term Actuarial Mathematics) lesson in Pension Plans and Retirement Benefits. 41 min read, ~6,178 words.
TUC values accrued benefit at CURRENT salary. PUC values accrued benefit at PROJECTED salary at exit or retirement. AAL is the PV of benefits attributed to PAST service. NC is the PV of benefits attributed to ONE additional service year. For final-pay plans, PUC AAL TUC AAL whenever the salary...
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What this lesson covers
- Content
- Example 1
- Example 2
- Example 3: Multi-Age Retirement with 3-Year FAS and 50% J&S
- Example 4: Death-in-Service plus Withdrawal Multi-Decrement NC
- Example 5: Recursion NC, Roll-Forward Gain, Divorce-Equivalence
- Common Mistakes
- Key Takeaways
- Exam Shortcuts
Learning objectives
- 5e
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