# Early retirement -  is it necessary to make voluntary contributions for pension?



## johnd (15 Nov 2011)

If a person retires early, at age 63, after working in the same job for 30 years paying full PRSI is it necessary for him to pay voluntary contributions to ensure he receives the full old age pension at 65?

I have a relative in this situation -  many thanks for any assistance.


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## ClubMan (15 Nov 2011)

Any use?

http://www.citizensinformation.ie/e...etired_people/state_pension_contributory.html



> If you retire early, you should ensure that you continue to pay PRSI contributions or get credited contributions to maintain your entitlement to a pension.



http://www.citizensinformation.ie/e...lder_and_retired_people/early_retirement.html



> If you do retire early you should organise to continue your PRSI contributions so that your entitlement to an State Pension (Contributory) is maintained (see 'Credits' below).


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## Black Sheep (15 Nov 2011)

Just to clarify State Pension (formerly Old Age Pension) is payable at age *66.*

Transition pension (formerly Retirement Pension) payable at age *65* is being abolished in 2013


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## Eithneangela (16 Nov 2011)

Just to reassure OP, I retired early and have been signing a form in January each year which basically credits my account with Social Welfare to allow me to claim the State Contributary OAP at the appropriate time. I am not working and I am not claiming anything from the State which I think is necessary in order to claim the credit.


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## ClubMan (16 Nov 2011)

Are you on some _SW _payment that entitles you to such credits? I don't think that it's necessarily the case that somebody who retires early gets them. For example somebody who retires early and lives off private pension or other income/savings and does not qualify for any _SW _payment does not as far as I know. In short the original poster's relative's situation may differ from your situation.


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## johnd (16 Nov 2011)

Eithneangela, thank you for your reply. Basic position is that my relative wants to retire early.  He suffers from a disability and it is increasing difficult for him to continue especially in the winter months. He is 63 so three to go to pension age.  His wife works full time so they can live on her wage but its his pension contributions he is worried about. 

I had read the www.welfare.ie website and he does have 10 years (30 actually) contributions required for aa full pension at 66 so he should be fine.
There was something about a yearly average which puzzled us but that seems to be for a earlier period.


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## ClubMan (16 Nov 2011)

Would he be going on some form of _SW _disability payment in which case credits may be paid automatically or once he requests them?


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## johnd (16 Nov 2011)

ClubMan - He's not sure if that is an option - his disability has not prevented him working up to now, that's his opinion by the way not mine.  

His doctor is the Hale and Harty type who believes hard work never killed anyone so he would be reluctant to go that route in case he is dismissed . As i said his only reluctance about taking this step was his pension and those concerns now seem to be answered.


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## johnd (16 Nov 2011)

Typo error - should be Hale And Hearty


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## ClubMan (16 Nov 2011)

Could he get a second opinion?


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## elcato (16 Nov 2011)

> Could he get a second opinion?


He did. But looks like Dr Hearty agreed with Dr Hale


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## Eithneangela (16 Nov 2011)

Hi Clubman - just to clarify - I worked for 37 years and paid full stamps all that time. I've never claimed any SW payment.


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## ClubMan (16 Nov 2011)

Eithneangela said:


> Hi Clubman - just to clarify - I worked for 37 years and paid full stamps all that time. I've never claimed any SW payment.


Thanks - then that seems to conflict with the information that I posted/referred to here?

http://www.askaboutmoney.com/showpost.php?p=1219765&postcount=2

and also this:

http://www.citizensinformation.ie/e...ed_social_insurance_contributions.html#l1f4da



> *Credits and early retirement*
> 
> If you are getting a Sate Pension (Transition) you will automatically be given _credits_. These _credits_ will help maintain your entitlement to Treatment Benefit and can also help you to qualify for [broken link removed].


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## wbbs (16 Nov 2011)

To the best of my knowledge he can sign for credits if he is looking for work.   Nothing to stop him retiring and looking for another job, in theory, he could draw jobseekers benefit until it runs out and then sign for credits.


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## Eithneangela (16 Nov 2011)

Clubman - I'm confused now. As far as I know I am entitled to a full state Contributary Pension at the appropriate time because I have built up a reservoir of stamps over a number of years, I am not working and I am not claiming any social assistance. Why else would the Department send me out a form each year in January to confirm that I am not working and wish to claim credit?


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## ClubMan (16 Nov 2011)

I'm not sure and maybe the info that I have read/referred to does not cover all circumstances but it certainly seems to imply that you need to be claiming some form of SW payment to qualify for credits or else you should make voluntary contributions in order to keep up your _PRSI _linked pension entitlements. Maybe somebody else can comment more authoritatively on this issue?


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## johnd (16 Nov 2011)

wbbs said:


> To the best of my knowledge he can sign for credits if he is looking for work.   Nothing to stop him retiring and looking for another job, in theory, he could draw jobseekers benefit until it runs out and then sign for credits.



I didn't know that was the situation. Would SW not consider a person who took early retirement unavailable for work?  He has a very obvious disability but is otherwise healthy if you understand, but the cold and damp conditions does affect him. His doctor is not very understanding, he himself is well past retiring age and intends to keep going until he drops!


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## wbbs (16 Nov 2011)

Just because you take early retirement does not mean you cannot be looking for other sort of work, people take early retirement all the time and start working again straight away.  For example gardai, who can retire quite early.   If you are looking for work then you can sign on for jobseekers benefit, retired or not, am almost, (note almost!) positive of this.   

In my own situation my benefit has run out, I am still seeking work and do not qualify for jobseekers allowance so I sign once a month for credits to maintain my prsi record for pension.         Some former colleagues of mine actually got early retirement and have a pension payment and they were able to draw their jb because they were looking for another job.   AFAIK the entitlement to full pension is worked out by some calculation of average payments per year based on the number of years from when you started work to normal retirement age, I would be afraid that the government would change the goalposts on this in the future so intend to continue signing for credits even though at the moment I would probably have enough actual paid contributions.


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## Black Sheep (16 Nov 2011)

As there is no regulation which states that you can't retire and claim jobseekers Benefit while looking for another job the SW have no option but go along with this situation. Following the end of Jobseekers Benefit (limited to 1 year) you then continue to sign for credits up to Pension time.

There may (or may not) be a few weeks between retiring from one job and starting another.

Many people do this who have very heavy or presurised work situations and do a couple years in a less stressful situation.

The rate of pension you will receive depends on the total number of PRSI contributions paid divided by the number of years worked to get a "yearly average".


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## johnd (17 Nov 2011)

Thanks to everyone who replied  to my query. Your imformation is very helpful.


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