If you want to ensure that you have adequate income in retirement, and the State pension (approximately €1,000 per month) will not meet your needs, you should be aware of the pension options open to you. These will depend mainly on your work situation. If you are employed, you may be covered by an employer-sponsored occupational pension scheme (usually a defined contribution scheme) or relevant public sector defined benefit scheme.
Personal pensions in Ireland mean pensions that are organised individually by self-employed people or employed people who do not have an occupational pension scheme.
The rules governing personal pensions have changed very considerably in recent years. For example from 27 March 2013 you can withdraw up to 30% of the value of Additional Voluntary Contributions (AVCs) made to occupational pension schemes and PRSAs. This applies for 3 years only (until 27 March 2016).
There are a variety of different pension vehicles such as:
- Personal Pension Plans (PPP): If you are self employed, or if your employer does not offer an occupational pension
- Personal Retirement Savings Account (PRSA): A simple flexible pension which you can take out regardless of employment status
- Retirement Bond: Lets you take your pension with you when changing jobs without having to transfer to your new employers scheme
- Executive Pension Plan (EPP): A pension designed for company directors and owners
- AVC’s and PRSA AVC’s: Additional and optional payments to an existing pension scheme to build up an additional retirement fund.
- Self Directed Pension: Suitable for experienced investors who wish to manage their pension fund investments themselves.
- Defined Contribution Scheme: Occupational pension schemes where your own contributions and your employer’s contributions are both invested and the proceeds used to buy a pension and/or other benefits at retirement.
The value of your pension at retirement depends on how much you can afford to put away each month, the length of time you are making contributions, the type of pension plan you select and the investment return.
How Rockcourt can help?
Every worker has a different life and different set of circumstances. As you can see from the above there are many options that are available to save for retirement. When we are outlining your pension options we will go through in detail your tax saving potential, projected retirement benefits, outgoings, savings and loans. As a pension involves investing, it is essential that an Investment Questionnaire be completed. Recommendations will be then made by one of our experienced Financial Consultants.