A few questions about preserved benefits

[The Ghoul]

Let's says someone is in a public sector admin job and was recruited post 1995 but before 2004. They wish to leave the public sector well before retirement age. Had they stayed in the service they would have had 40 years by age 62.

Does their preserved benefit apply at age 60, 62, 65 or at some other age? Is there an actuarial reduction if it is claimed at age 60, 62 or 65.

Let's say they have 10 years service, do they get a 1/4 lump sum and a 1/4 pension at retirement age. If this 1/4 pension is less than a full contributory old age pension, can PRSI contributions then be looked at to ascertain if they are eligible for a full contributory old age pension.

Alternatively let's say that they have 20 years service and get a 1/2 lump sum and a 1/2 pension with this pension being higher than the contributory old age pension. But if they paid no PRSI from the time they left the public service to when they retired - do they still get the 1/2 pension?

 

[Squaremile]

Does their preserved benefit apply at age 60, 62, 65 or at some other age?

In this case preserved entitlements are due at 60.

Is there an actuarial reduction if it is claimed at age 60, 62 or 65?

No as 60 is normal retirement age.

Let's say they have 10 years service, do they get a 1/4 lump sum and a 1/4 pension at retirement age. If this 1/4 pension is less than a full contributory old age pension, can PRSI contributions then be looked at to ascertain if they are eligible for a full contributory old age pension.

Alternatively let's say that they have 20 years service and get a 1/2 lump sum and a 1/2 pension with this pension being higher than the contributory old age pension. But if they paid no PRSI from the time they left the public service to when they retired - do they still get the 1/2 pension?

With 10/20 years service they would get the equivalent of 1/4 or 1/2 of the maximum lump sum but would not get 1/4 or 1/2 of the maximum pension as benefits in this situation are calculated on net pensionable salary (i.e. reduction to account for the state contributory pension).

Entitlement for the full or pro rata state contributory pension in both situations would be determined by your average PRSI contributions. If you do no qualify for the full state pension then in certain circumstances you may receive a supplementary pension for a period from your previous employer bringing you up to a maximum of what your pension would have been had you been a pre-1995 member.

Andrew
Squaremile Financial Consultants

 

[shigllgetcha]

You should be a Class A contributor if you were appointed after 1995, so you wont get 1/80 per years service ie 40/80 for 40 years service or 10/80 for 10 years

Class As only get 1/200 per years service upto 3.33 OAP and 1/80 per years service above 3.33 OAP

You could also apply for cost neutral after 50 which means you would get a reduced lump sum and pension but you can receive it earlier