Any advantage to buying A rate PRSI

Clare12

Registered User
Messages
33
Am 55 years, working in public sector, D rate PRSI, will have approx. 34 years service at 65 years, is it possible to buy A rate PRSI or is there any advantage to doing this? I don't have widows or orphans on my D rate. My projected pension at 65 will be about 19,000. Husband is self employed with a mix of A rate and now S rate PRSI.
 

Itchy

Frequent Poster
Messages
271
Hi Clare, a relative of mine has retired with a mix of D rate and A rate contributions. She was offered the opportunity to pay the spouses and children's contributions and effectively have all her service as A class (contribution deducted from the lump sum). Like you though i'm not sure what the advantage is if S&C benefit is not relevant? Because a portion of the service was a A class, there is still an element of signing on/supplementary pension etc. hoops to jump through.
 

Clare12

Registered User
Messages
33
PRSI is a minefield, I don't think there are any options open to me, buying notional service is not an option, it's very expensive and I don't have the option of buying back service as this is only available to people who have time worked which had no pension deductions taken. And this is supposedly the Rolls Royce of public sector pensions. And no entitlement to contributory pension.
 

Itchy

Frequent Poster
Messages
271
I think the principle between A rate and D rate is that they will pay the same amount no matter which pension you have. The difference is the source of the funds and the benefits. Other than buying notional service you dont have may options to increase final pension. Ensure you have you PRSI contributions checked so you know what contributory pension you would be entitled to if you bought the A pension. There could be notional contributions for years if were a homemaker maybe, but im not sure of the rules on this. Otherwise, you can claim tax relief on any notional service and it may actually be very valuable despite the up front cost. IF you dont have the cash though then the point is moot.

Maybe someone can answer better in relation to managing a mixed A/D PRSI pension? What considerations are there?
 

Chelsea1

New Member
Messages
9
PRS1 payees upon reaching retd at 60 years of age have to apply for job seekers allowance. It is an absolute joke. We are slaves to the state. I retired 31st March 2019, have to sign on in INTREO centre x 2 since that date and obtained another date today for May.
I also got a letter inviting me in for a, "chat ' to discuss work options, it's a complete joke, you all need to write to the Minister for social protection to inform her how awful this system is for retired people. I am so angry, cannot go anywhere, its like they are taunting me every day since I retired.
 

Conan

Frequent Poster
Messages
895
Two points:
1. You do not have to sign on for Jobseekers Benefit.
2. But if you do and expect a payment, then the clue is in the title....Jobseekers.

If you “retired” then perhaps you don’t need to claim a Jobseekers payment. You could just sign-on for credits.
I don’t see why you have a problem with the process. If you expect a SW payment (even though you are “retired”) then there are some conditions. Why do you expect a payment for nothing?
 

fairy1

New Member
Messages
2
If you sign for credits you still have to be available for work. As Conan states you are claiming a Jobseekers payment.
 

Conan

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895
And I should have mentioned that once you are over age 62, you are not required to be actively seeking employment.
 

NoRegretsCoyote

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Messages
455
@Chelsea1 An able-bodied 60-year old should not be expected to receive 'jobseeker's' payment without seeking a job.

So turn up, and play along.

They can impose penalty sanctions if you aren't seen to be seeking a job, but as a last resort. I would be very surprised if they imposed penalty sanctions on a retired 60-year old.
 

Early Riser

Frequent Poster
Messages
505
@Chelsea1 An able-bodied 60-year old should not be expected to receive 'jobseeker's' payment without seeking a job.

So turn up, and play along.

They can impose penalty sanctions if you aren't seen to be seeking a job, but as a last resort. I would be very surprised if they imposed penalty sanctions on a retired 60-year old.
It is not quite as straight forward as that, though. As a pre 2004 public servant retiring at 60, Chelsea1 is entitled to receive a Supplementary Pension if he is bona fide retired (not otherwise working in an insurable capacity). However, this only applies if he/she is not entitled to a Social Welfare payment. He/She has to apply for any relevant payment (in this case Jobseekers) before being eligible for the Supplementary. It is all a bit of a charade.

However, on the plus side, Class A stamps continue to be credited during the Jobseekers payment and Chelsea1 can remain signed on for Credits afterwards up to 65 (if not working, etc).This is very valuable if short of credits for State Pension purposes (and to avail of any benefits, eg, dental, optical). The Supplementary is meant to bring the pension benefits up to the same level as a Class D retiree and ceases at State Pension age.
 

Chelsea1

New Member
Messages
9
Sorry Conan, but I do have to sign on, date given via text, and appts for reviews, it's all part of :Co ordinated Pension Process: as a A1 PRSI employee prior to retiring. It is suppose to get better for retirees aged 62 years old,, only have to sign on x 2, but I must still be available, willing and capable for work!
 

Chelsea1

New Member
Messages
9
Just a update, I have been called into an activation meeting where I am assigned a case officer and must be willing, able and capable for work, I am 62 next week, and I still must be available to work despite having worked for over 40 years in the health service. Of note I heard nothing back from the Minister as yet.
 

Conan

Frequent Poster
Messages
895
If you are 62 next week, I think you should remind your case officer of that fact. The concession for those over age 62 not to have to be available for work, is just that ....a concession. But I have heard that some “case officers” choose to ignore that “concession” and still insist that you be available for and actively seeking work. I would challenge the case officer on the age 62 issue.
Even if they agree that you don’t have to be available for work, you still must sign on for credits (typically on a specific date once a year).
 

Chelsea1

New Member
Messages
9
If you are 62 next week, I think you should remind your case officer of that fact. The concession for those over age 62 not to have to be available for work, is just that ....a concession. But I have heard that some “case officers” choose to ignore that “concession” and still insist that you be available for and actively seeking work. I would challenge the case officer on the age 62 issue.
Even if they agree that you don’t have to be available for work, you still must sign on for credits (typically on a specific date once a year).
Thanks Conan, I most definitely will, and wi
 

Early Riser

Frequent Poster
Messages
505
It is a condition for JSB that you are available for, and seeking, work. You will already have indicated this on the application form. If you tell you case officer that you are not available for work you are liable to face a penalty.

What changes at 62 is that you should not be required to engage in Activation, ie, training courses, etc. If you are assigned to an activation programme before 62 you are required to complete it, even if you turn 62 during it. I think it unlikely that you will be told to take up an activation programme when you meet (given that you are so close to 62). But that does not change the underlying conditions for eligibility.

From Citizens Information:
"Since 1 January 2014, if you are claiming Jobseeker’s Benefit orJobsekers Allowance and are aged 62 or over, you will no longer be required to engage with the compulsory activation process (see below) and you will not be subject to penalty rates for non-engagement. (All other rules for Jobseeker's Benefit or Allowance still apply.)

However, if you are already engaged in activation (selected and referred for engagement) or if you are currently taking part in an activation programme (such as Community Employment, JobPath or training courses), you are expected to complete the programme. If you leave activation programmes before completion, your jobseeker's payment may be reduced."


"What is activation?
Labour market activation policies are designed to give jobseekers a better chance of finding employment. The Department of Employment Affairs and Social Protection describes activation as its engagement with jobseekers to support them back into employment. Jobseekers are expected to fully engage with this process and use the supports offered during the activation process which might include education or training schemes, employment support schemes to help them back into the workplace, internships and other supports."


In the unlikely event that you are denied JSB you can apply for the Supplementary Pension from your ex-employer.
 

Susie2017

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Messages
144
Interesting post. Can I ask a couple of questions; how did you manage to retire at 60 in the health service ? Was it on ill health grounds ? When will you get your lump sum and HSE pension do you have to wait for both til 65? Also how have the rules changed for post 2004 entrants ? Sorry I'm clueless about pensions but would also like to get out early at 60. Don't fancy living on welfare or working til 65. Will have around 33 years service at 60 but was only made permanent in 2007.
 

Early Riser

Frequent Poster
Messages
505
Interesting post. Can I ask a couple of questions; how did you manage to retire at 60 in the health service ? Was it on ill health grounds ? When will you get your lump sum and HSE pension do you have to wait for both til 65? Also how have the rules changed for post 2004 entrants ? Sorry I'm clueless about pensions but would also like to get out early at 60. Don't fancy living on welfare or working til 65. Will have around 33 years service at 60 but was only made permanent in 2007.
Pre-2004 pension scheme members can retire with pension (and lump sum) at 60 , post 2004 it is 65, and for the Single Scheme it is different again.
When did you join the pension scheme ? You need to determine whether you are a pre or post 2004 entrant. If post 2004 it is possible to retire before 65 but on Cost Neutral Early Retirement, ie, with an actuarially reduced pension. There would be no possible eligibility for a Supplementary Pension before 65.
 

Feemar5

Frequent Poster
Messages
203
Consider yourself lucky to be able to retire at 60 and get lump sum and pension. I retired at 65 and had to claim jobseeker's benefit for 1 year as pension did not kick in until 66, but I did not have to look for work.. There is a difference between allowance and benefit . Benefit is for people who have enough contributions paid .
 

Susie2017

Frequent Poster
Messages
144
Ok so not good news either way. Im definitely post 2004 as up until then i was on short term contracts. I also worked outside the hse for a few years. The poster is lucky to get a sw payment. Would you advise me to try to buy extra years in the coming years. Presumably that would help reduce the actuarial reduction. Also do you need approval to go at say 60 or will they insist on you staying til 65. I absolutely do not want to work til then.
 

Early Riser

Frequent Poster
Messages
505
Also do you need approval to go at say 60 or will they insist on you staying til 65.
Officially I think you may need approval but practically it will be your choice. I have never heard of anyone being refused.

Would you advise me to try to buy extra years in the coming years. Presumably that would help reduce the actuarial reduction.
Assuming you are a higher rate tax payer it would certainly make economic sense to either purchase notional service or take out an AVC. The main advantage of notional service is that the benefits purchased are guaranteed, ie, €x increase in your annual pension and €y increase in your lump sum. Don't forget that the pension for service purchased will also be actuarially reduced if you retire early.

The main advantage of an AVC fund is flexibility. You can use it to max up your lump sum to 1.5 times pensionable salary, provided you have at least 20 years service (there will be a small actuarial reduction in the 1.5 limit if you retire early) and any left over can be transferred to an ARF to be drawn down flexibly, eg, you might front load withdrawals in the years before you become eligible for the State Pension. Of course, an AVC carries fees and charges.
The Pensions Authority has a guidance booklet on Notional Years v AVCs here:
Before either of these options make sure you have bought back any actual service you may have had in the public service (part-time, temp., etc) - this is much cheaper than AVCs/notional service.

The poster is lucky to get a sw payment
The main advantage for the pre-2004 is eligibility for the Supplementary Pension before 65 (aside from the fact of being able to retire normally from age 60!). A post 2004 pensioner could equally apply for Jobseekers Benefit but when it runs out in 9 months they would have to wait until 65 before applying for the Supplementary (payable up to State Pension age once the conditions are met).
 
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