Leaving Service - Defer Benefit V Transfer of Benefit

N

noell

Guest
I will shortly be leaving my job. I plan to spend 12-18 months travelling and will not have an income during this time.

I'm leaning toward transfer of the occupational pension scheme benefit to a PRSA rather than deferral of the preserved benefit. Preserved benefit payable is approx. €6.5K p.a. Transfer Value = €20K approx.

is the option of transfer to a PRSA available in practice - a couple of posts have suggested that this service is not available yet ?
 
According to the [broken link removed] occupational to PRSA transfers are only allowed in certain specific circumstances (see the document Appendix for further information):

Interface with Occupational Pension Schemes

19. Transfers from an occupational pension scheme or a statutory scheme to a PRSA will be allowed where the member has been in the scheme for 15 years or less and either
<!--EZCODE LIST START--><ul><li>the scheme is being wound up, or</li><li>the member is changing employment.</li></ul><!--EZCODE LIST END-->
The value of AVC contributions to an occupational pension scheme may be transferred to a PRSA without regard to the foregoing restrictions.

As a general rule any transfer of pension funds from one scheme to another is only advisable if it results in the same or lower charges being levied and/or additional flexibility or ease of administration etc. - transfers are never necessarily a good idea and must be evaluated on a case by case basis.

Hope this helps.
 
Its nearly impossible for this person to have more than 15 years service with the small transfer value they are giving(consdiering this is a DB pension).

S
 
Noell,
Yes it is.
I believe that you must be provided with a projected benefit for the PRSA scheme that you wish to place the money in BEFORE you do the transfer.

The projected benefit will try to show what 20K invested up to NRA would be able to provide for you in fund size but also as annuity return.
This may help you decide on what course of action to take.
Of course the 6.5K/pa is guaranteed, you may get far less(or more of course) if you place it in a PRSA.

S
 
yes - should have stated that I have less than 15 years service.

thanks for the replies - they're helpful.

-NL-
 
Transfer of pension scheme benefit to PRSA

This is one of the myths about PRSAs..that you can transfer bits and pieces into a PRSA. In fact transferability into and out of PRSA is subject to all types of hurdles, red tape and mountains of paper.

In order to transfer a non AVC benefit from a pension scheme to a PRSA there are many many hurdles to be overcome, which makes it virtually impossible!

1> Your pension scheme would have to change its rules to allow you to transfer..your ex employer is under no obligation to do this and may not see why he should do this just to suit ex employees. So there's no God given right to such a transfer..it's in the gift of your ex employer and scheme trustees.

2> you have to be 'changing employment'...leaving service isn't enough.

3> you have to have < 15 years scheme service

4> If TV is > €4k, you have to be given a Certificate of COmparison, be PRSA company or someone acting on their behalf, comparing projected value of PRSA benefits V your benefit in the scheme

5> PRSA company or someone acting on their behalf, has to give you a written statement as to why such a transfer would be in your interests.

6> PRSA company or someone acting on their behalf who prepared the Certificate and written statement has to have minimum PI cover of €1m per claim!

I think I'd forget it ...you'd be long back from your travels before this transfer would go through!
 
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