# Is This Scenario Possible as looking to see if I can retire early?



## Zipiter (3 Feb 2020)

Hello
Im looking to see if I can retire early.

My background...
Im aged 45 and a Primary School Teacher currently earning 55K. I subbed (teaching) in fixed term contracts, sept-June, for 4 years before qualifying 10 years ago. Been in a permanent contract since 2010. Prior to this I had about 4 years in other public service employment.

I am married with no children. My wife works part-time. My mortgage is 59K outstanding on a house valued approx 160K.

I have an AVC with Cornmarket with approx 25k invested.
No other investments.
My wife has a tiny pension worth approx 1500 PA from a previous employment.
Car loans with credit union 24K over 4 years.
Neither of us smoke or drink and thankfully are in very good health.

I really would like to retire at 55.
Am I dreaming?

Would this scenario be possible?

Are there any steps/actions that I could take to fulfil this scenario?


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## josh8267 (4 Feb 2020)

Am i correct in saying one of you is already semi retired, seeing you have 24k  borrowed from Credit Union getting used of living off your pension at 55 will take a bit of getting used of,


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## NoRegretsCoyote (4 Feb 2020)

It's hard to say without more information.

Primary school teachers have the joy of summer holidays and afternoons. Do/would you consider working in summer camps, grinds, etc?


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## Leper (4 Feb 2020)

From what I see in the original post Zipiter can't retire by age 55. NRC is right and there is paucity of information. My advice:- If in doubt, don't go out.


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## Steven Barrett (4 Feb 2020)

Your difficulty is in being in a defined benefit pension. Whereas those in a defined contribution pension can max out their pension each year and draw down their benefits at age 55, you can't. You will have to wait until age 65 or take an actuarially reduced pension from age 60 onwards...if it is made available.

To make it happen, you are going to have to save the required income through private savings and investments. You won't get the benefit of tax relief on your contributions though. 

To make it happen you will have to save hard and cut back on your expenditure. Read about the FIRE movement because that may be the kind of lifestyle you will require to make it happen. If that's not for you, enjoy the long summer holidays. 

Steven
www.bluewaterfp.ie


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## elacsaplau (4 Feb 2020)

SBarrett said:


> Your difficulty is in being in a defined benefit pension. Whereas those in a defined contribution pension can max out their pension each year and draw down their benefits at age 55, you can't.



Are you sure this is right, Brendan.

My neighbour is a muinteoir and told me that when she hits 55, she can take her pension based on accrued service without any reduction for early retirement. When she saw the surprise on my face (I had thought that early retirement reduction factors applied before 60), she told me that the age 60 applies to the standard (historic) civil service scheme but that teachers have different terms. Maybe there are different iterations of the teachers pension scheme?


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## NoRegretsCoyote (4 Feb 2020)

elacsaplau said:


> Are you sure this is right, Brendan.
> 
> My neighbour is a muinteoir and told me that when she hits 55, she can take her pension based on accrued service without any reduction for early retirement.



It depends. If she is a recent entrant and member of the Single Scheme then there is a "facility for early retirement from age 55 on cost-neutral (actuarially reduced) grounds; "

I don't think this applies to OP but could be wrong.


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## elacsaplau (4 Feb 2020)

I think the OP is male and that as he has more than 10 years service, he joined before the Single Scheme started?


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## Ndiddy (6 Feb 2020)

SBarrett said:


> Your difficulty is in being in a defined benefit pension. Whereas those in a defined contribution pension can max out their pension each year and draw down their benefits at age 55, you can't. You will have to wait until age 65 or take an actuarially reduced pension from age 60 onwards...if it is made available.
> 
> To make it happen, you are going to have to save the required income through private savings and investments. You won't get the benefit of tax relief on your contributions though.
> 
> ...



For DC plans, if the plan allows for such, one can actually withdraw from 50 years of age?


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## NoRegretsCoyote (6 Feb 2020)

elacsaplau said:


> I think the OP is male and that as he has more than 10 years service, he joined before the Single Scheme started?


Yes I guess so.


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## Early Riser (6 Feb 2020)

elacsaplau said:


> Are you sure this is right, Brendan.
> 
> My neighbour is a muinteoir and told me that when she hits 55, she can take her pension based on accrued service without any reduction for early retirement. When she saw the surprise on my face (I had thought that early retirement reduction factors applied before 60), she told me that the age 60 applies to the standard (historic) civil service scheme but that teachers have different terms. Maybe there are different iterations of the teachers pension scheme?



As I understand it, pre-2004 teacher entrants could retire without actuarial reduction at 55 provided they had 35 years of service - and I think there is partial allowance for pre-service training. However, this would not apply to the OP who joined in 2010. His normal retirement age would be 65. He could take CNER at 55 but his accrued pension would be reduced to 58.2%. Given his short service this could be a relatively small amount.

OP - Make sure all your pre permanent-contract work is made pensionable, if is not already. It can be bought back. This is good value.


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## elacsaplau (6 Feb 2020)

Thanks Early Riser - 



elacsaplau said:


> Maybe there are different iterations of the teachers pension scheme?



What you say makes sense. That's why I gave myself the above opt-out!!


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## Early Riser (6 Feb 2020)

Zipiter said:


> Im aged 45 and a Primary School Teacher currently earning 55K. I subbed (teaching) in fixed term contracts, sept-June, for 4 years before qualifying 10 years ago. Been in a permanent contract since 2010. Prior to this I had about 4 years in other public service employment.



Hi Zipiter,

Have you used the Primary Teachers' Pensions Estimator which is linked from the Dept of Eds Pensions page?

Just to get a rough idea I did an estimate for CNER pension based on 24 years service and a pensionable salary of €55K . I know you should have some increments and, perhaps, promotion before you reach 55 but I ignored this. Also, I used 24 years as a rough estimate of pensionable service at 55 as you have some previous service to 2010. But this is just to give some rough idea.

Based on this the Estimator gives a CNER pension at 55 of €5,115 pa and a lump sum of €40,940.  The Supplementary estimate is for €7,774 but you would not be eligible for this until your normal retirement age (65).

If you worked another 5 years until 60 at took CNER with 29 years service, the estimate is for a pension of €7,950 and a lump sum of €54,500. The Supplementary would be €9,400 but, again, not before 65.

If you worked until 65 and retired normally with 34 years service, the estimate is for a pension of €12,450 and a lump sum of €70,400. Provided the State Pension (or Social Welfare payment) is not due to you at 65, you would also be eligible for a Supplementary of €11,015.

These very rough figures may give you a better idea of what age you might dream to retire at. Any AVCs you have could be used to top up the tax-free lump sum to Revenue limits and , beyond this, to fund an ARF/AMRF.



Zipiter said:


> I really would like to retire at 55.
> Am I dreaming?


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## josh8267 (6 Feb 2020)

elacsaplau said:


> Are you sure this is right, Brendan.


Do you know something we don't ?
Who is the Brendan,


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## Zipiter (10 Feb 2020)

_Plenty of food for thought!!_ Thank you!

A question regarding the supplementary pension....is this added onto the Dept pension. For example retiring at 60 would be 7950 plus 9400??

I don't think that 55 is realistic based on feedback!!


Would buying years , (is it notional service??) an option I could consider?

Also if retiring at 55 would the option of sub work  a day or two a week be available to me without penalty?
Many thanks everyone.


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## Zipiter (10 Feb 2020)

Early Riser said:


> *OP - Make sure all your pre permanent-contract work is made pensionable, if is not already. It can be bought back. This is good value.*



Can you explain bolded part please?


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## Early Riser (10 Feb 2020)

Zipiter said:


> My background...
> Im aged 45 and a Primary School Teacher currently earning 55K.* I subbed (teaching) in fixed term contracts, sept-June, for 4 years before qualifying 10 years ago*. Been in a permanent contract since 2010. Prior to this I had about 4 years in other public service employment.



Were you in the pension scheme for the fixed term contracts highlighted above? If not, you should be able to "buy back" this service now. This is different to buying "notional years" and is cheaper. It will give you a few more years of pensionable service at retirement. (Maybe you have already bought it back?).

I am assuming you were in a separate pension scheme during the prior 4 years in the public service?




Zipiter said:


> Can you explain bolded part please?


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## Early Riser (10 Feb 2020)

Zipiter said:


> A question regarding the supplementary pension....is this added onto the Dept pension. For example retiring at 60 would be 7950 plus 9400??



I understand that you only joined the pension scheme in 2010? If so, you are a post-2004 entrant and your "normal retirement age" is 65. The Supplementary Pension is only payable from normal retirement age. (Pre-2004 entrants had a normal retirement age of 60.)

The Supplemenary Pension is payable in addition to the Occupational Pension after a person's normal retirement age provided they are not in insurable employment or self-employment, and they are not receiving or entitled to receive a Social Welfare payment (Jobseekers Benefit or State Pension).


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## huskerdu (11 Feb 2020)

If you review your overall situation, you say that you have been working for 18 years. ( Possibly other work you havent mentioned). 

If this is true, you will only have worked for 28 years when you are 55. 

I wish you a long and healthy life so lets assume you reach the average life expectancy of 84. 
You need to have a pension fund which will last 29 years which is a big ask on 28 years work. 

You will also need to ensure you have enough PRSI contributions to get the full state pension which you wo'nt at 55.


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## Zipiter (12 Feb 2020)

Early Riser said:


> Were you in the pension scheme for the fixed term contracts highlighted above? If not, you should be able to "buy back" this service now. This is different to buying "notional years" and is cheaper. It will give you a few more years of pensionable service at retirement. (Maybe you have already bought it back?).
> 
> I am assuming you were in a separate pension scheme during the prior 4 years in the public service?


Yes, I paid the relevant pension requirements during this time.

I was a clerical officer in the Civil Service during the 4 years prior to teaching.


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## Zipiter (12 Feb 2020)

huskerdu said:


> If you review your overall situation, you say that you have been working for 18 years. ( Possibly other work you havent mentioned).
> 
> If this is true, you will only have worked for 28 years when you are 55.
> 
> ...


How many contributions do I need for full pension?


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