What happens to friend's pension fund when he leaves his employment?

Friend is leaving employment 30th June and has about €8k in the company pension scheme, the company matched employee contributions. He doesn't have a new job yet.

He doesn't necessarily want to access the cash, just exercise control/ownership of the fund.

What is the procedure here?

If his primary aim is to extract the fund from the company scheme and put it into his own control, he can transfer it into a Buy-Out Bond of his own choosing - a lump sum pension product that allows him freedom to choose funds etc. If he has less than 15 years' service he can also transfer the fund into a PRSA, which would serve a similar purpose.

There are some differences:

• A Buy-Out Bond allows early retirement from age 50. A PRSA only allows early retirement from age 50 if he's retiring from PAYE employment at that time.
• A PRSA can accept further contributions in the future if his circumstances permit. A Buy-Out Bond can't.

Either of the above financial products can be arranged by any broker or most pension companies. Charges can vary depending on the product producer and distribution channel, so he should shop around.

Liam D. Ferguson

Ok. As he is no longer a company employee from 1st July, can he deal with the pension company directly himself? He wants nothing to do with the soon to be former employer.

STEINER said:

Ok. As he is no longer a company employee from 1st July, can he deal with the pension company directly himself? He wants nothing to do with the soon to be former employer.

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Yes, he can go to any pension company or broker to arrange the plans into which he proposes to transfer his fund. (He doesn't have to use the company that acts for his employer, unless he wants to.)

If his employer is also trustee of the pension scheme they will need to sign off on the transfer, which will be their last act in relation to his fund. If he doesn't want to have any dealings with the employer, he can get the recipient pension company or broker to deal with that.

ok, thanks Liam.