# Buy back husbands civil service pension or start my own



## liadain (25 Sep 2012)

My husband and I (42 +39) foolishly kept our old house as a pension, which is in substantial negative equity now.

 He started in the Civil Service 10 years ago and is paying the mandatory amount into this pension.

AS far as pensions go, that's it for us and am now starting to look into it again. 

Is it better for us if we buy back his years in the Civil Service or for me to start a different pension of my own? My employer does not give any pension contributions.

Thanks


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## Complainer (25 Sep 2012)

It's an interesting question. From a purely financial side, you should get some projections from a pension consultant to compare a private DC pension. So for example, if you were to put €400 per month into buying back service, what would this get you in a private pension scheme? Obviously, there will be lots of assumptions about growth etc in this calculation, but it will give you something to compare against.

Possibly the bigger question is the question of the risk of a public defined benefit pension scheme. Despite what you read in the Irish Indo, your public pension may be even more risky than a private pension. If the Govt defaults at some stage, you may not get all that you expected. If the Govt changes the policy about how it treats pensioners, you may not get the index linking that current pensioners get. Tread carefully.


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## shigllgetcha (1 Oct 2012)

liadain said:


> Is it better for us if we buy back his years in the Civil Service


 
It seems like you are talking about "notional service" where one would buy years one wasnt going to have by retirement. Its terribly expensive and very uncommon to use notional service, your money would be better off elsewhere


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## bleary (1 Oct 2012)

shigllgetcha said:


> Its terribly expensive and very uncommon to use notional service, your money would be better off elsewhere


I'd disagree that it is uncommon but it is a lot more expensive than it used to be some years ago as there is now an actuarial calculation included in the calculation .
There doesn't seem to be a straightforward answer to this question anymore. Probably best to get an inital quote from husbands employer and then look into options for your own pension also. 
Besides that what would happen if in the worst scenario you split up for some reason and you had all the pension provision in your husbands name? would you have an automatic entitlement to his pensions?


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## Slim (1 Oct 2012)

liadain said:


> My husband and I (42 +39) foolishly kept our old house as a pension, which is in substantial negative equity now.
> 
> He started in the Civil Service 10 years ago and is paying the mandatory amount into this pension.
> 
> ...


 
There is a calculator on cspensions.ie http://www.cspensions.gov.ie/modellers.asp This would give you an idea of your husbands likely cost of notional service. All depends on your husbands minimum retirement age (is it 60 or 65 or higher?). After that, it is question of weighing up the costs after tax versus setting up a separate pension or AVC for you or your husband.

Quick mock calculation suggests, based on a salary of €42k, cost would be 151k lump sum or €4,230 pa. to retire at age 60. Seems a lot more expensive in a lump sum!


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## Complainer (2 Oct 2012)

shigllgetcha said:


> It seems like you are talking about "notional service" where one would buy years one wasnt going to have by retirement. Its terribly expensive and very uncommon to use notional service, your money would be better off elsewhere


Would you like to expand on your basis for saying that it is terribly expensive and very uncommon? Expensive compared to what? How uncommon is it?


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