private clients
Retirement Planning
There are lots of factors to consider before you start planning your retirement. The decisions you make now can make all the difference to your lifestyle in retirement.
There are several options for accessing pension benefits upon retirement, depending on the type of pension plan you have.
Here’s a breakdown of the main options:
Occupational Pension Schemes (Company Pensions)
Typically provided by employers.
Upon retirement, you generally have the option to:
Take a tax-free lump sum (usually up to 25% of the fund, capped at €200,000 tax-free, with the next €300,000 taxed at 20%).
Use the remaining balance to buy an Annuity (a guaranteed income for life).
Transfer funds to an Approved Retirement Fund (ARF) for flexible withdrawals.
Personal Pensions & PRSAs (Personal Retirement Savings Accounts)
For self-employed individuals or those without occupational pensions.
Retirement options include:
Taking a tax-free lump sum (as above).
Purchasing an Annuity.
Moving the balance to an ARF/AMRF (Approved Minimum Retirement Fund), allowing more control over withdrawals.
State Pension (Contributory)
The State Pension (Contributory) is available to those who have made sufficient PRSI contributions.
The current retirement age is 66, but it is set to gradually increase in the future.
The pension is not means-tested and is paid weekly.
Annuity vs. ARF Options
Annuity:
Provides a guaranteed income for life but is fixed and inflexible.ARF (Approved Retirement Fund):
Offers investment flexibility, allowing you to manage withdrawals, but comes with investment risks.
Early Retirement Options
Occupational pensions may allow early retirement from age 50, subject to scheme rules.
PRSA and personal pensions can generally be accessed from age 60.
Tax implications and restrictions may apply.