# A1 Prsi



## BillyM (20 Sep 2007)

If I am paying AVC's and A1 PRSI my reading of the rules is that as I'm in a pension that pays out less the OAP 
1) I can aim for half my salary and still get the OAP on top 
2) Not bother with extra pension and put it in ARF
Sorry if this is basic but trying to understand pension's after years abroad and now back in Ire.
Have been studying Revenue rules and on to all pension,Regulator sites for info, as like to know as much as possible before committing cash.

By the way the ARF option seems brilliant, What's the drawback???
Opinions welcome.


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## asdfg (20 Sep 2007)

This has been discussed many times on AAM so a search may reveal more info 

Basically, you can aim to provide a pension of 2/3 of salary plus the oap. You can take 1.5 times you salary tax free with a reduced pension. 
You need to see how much your pension provides. 
Is it Defined Benefit or Defined Contribution
Revenue allows you to contribute a % of salary depending on age. The contribution is fully allowable against tax so if you pay tax at 41% plus 6% prsi you get tax relief of 47% of your contribution. You can make the contributions through payroll or annually. 

Not sure about the ARF option

See Key Posts here for more detailed info


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## Dave Vanian (21 Sep 2007)

> By the way the ARF option seems brilliant, What's the drawback???


 
An annuity is a guaranteed income for life.  You buy one and you forget about it forever and just wait for the income to roll in until you die.  

An ARF puts more responsibility in your hands - you still have to worry about how it's invested, how it's performing etc.  If you pick a badly-performing fund and/or withdraw too much you may end up running out of money before you run out of life.  And you may not relish the idea of monitoring how your ARF's fund performance is coming along when you're 80 years of age.  

That said, on balance ARFs are still viewed by many as preferable to annuities and there's nothing stopping you converting any unused ARF funds to an annuity years after you retire.


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## Jimbob2 (21 Sep 2007)

One other major difference between Annuity and ARF is that the Annuity dies with you (or your spouse if you die first and have a reversion to spouse on the annuity). Whatever's left in your ARF when you die passes to your estate.

Any AVC money can access ARF.


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