ARF and AMRF

[KOW]

With a pot of 400k put into Arf at age 60. Required drawdown of 4% p.a. That would be approx 16k income p.a. approx.
Is this considered guaranteed income in excess of the required 12700 p.a. or does one have to go the Amrf route?
Thanks.

 

[Conan]

No. You must have a “guaranteed income for life” of €12,700 plus to avoid having to invest some of the fund into an AMRF. However once you have a guaranteed income of €12,700 (eg getting a full State Pension for example) then the AMRF money can revert back to an ARF.

 

[moneymakeover]

What is the solution?

Put €63,500 into amrf

And remaining €336,500 into arf?

 

[Steven Barrett]

No. You must have a “guaranteed income for life” of €12,700 plus to avoid having to invest some of the fund into an AMRF. However once you have a guaranteed income of €12,700 (eg getting a full State Pension for example) then the AMRF money can revert back to an ARF.

It was changed to "guaranteed annual pension income".

What is the solution?

Put €63,500 into amrf

And remaining €336,500 into arf?

Yep. The €63,500 in the AMRF isn't subject to imputed distribution but you can take 4% out each year if you want. You can also use the €63,500 to purchase an annuity. It won't get you anywhere near €12,700 a year but it satisfies the requirement. I have never seen this done, everyone just puts the money in the AMRF. It converts to an ARF if in receipt of the full State pension (or next tier down) or you reach age 75.

Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)