Company closed down - what to do with pension?

Hi,

I'm wondering if anyone can give me advice..

I was in the DB pension scheme of my company for 5 years, when the irish branch of the company shut down, and I moved to another branch in europe.

The DB scheme is now being discontinued, and I have the choice :
- Transfer payment to a Pension Buy-Out Bond
- Transfer payment to an Occupational Pension Plan.

I have no idea what to do, since I dont understand the implications of either of the options. I'm trying to be in control of my finances and am trying to learn about pensions, but really am starting from absolutely no knowlege.

I plan to return to Ireland in the next year or so, so dont really fancy moving my pension abroad, in case there are tax issues with the other country.
If I opt for the Buy-Out Bond, is this just like leaving the money invested until I turn 65? Should I expect conditions e.g. to have the capital guaranteed, or an option on what funds the pension is invested into?

Any advice would be much appreciated.
Ragazza.

the buy out bond is a little flexible. You would have the option of early retiring from age 50 (obviously on a lower benefit than age 65). You chose the investment available, capital guarantee will obviously be a low risk/low return scenario. This may not be approriate if you are 10+ years from retirement. You can also transfer from the buy out bond to a new employers scheme in the future if you want. You cannot add further premiums to it.
It may not be possible to transfer the pension abroad in any case, this is only possible in certain cases where strict revenue conditions are met.

If the transfer value of the DB benefit is less than €10,000 you may be able to transfer it to a PRSA without the certificates of comaprision normally required (and which re infrequently done).

The PRSA may be more flexible than the Buy Out Bond in that you can add more to it. However, you will only get 25% of the fund as Tax Free cash at retirement which may be more or less than you could get from your deferred benefit. Your leaver statement should tell you what your tax free cash and deferred pension is.

Just to confirm on windup you don't need the certificate of comparison, so PRSA may be another option, if the poster has completed less than 15 years service in the scheme

Hi,

I had 7 years of service, and the transfer value is more than E10,000.

Thanks for the replys. At least now I have a couple of questions to ask the pension company - e.g. I didnt know that you can take part of the fund tax free at retirement, and I didnt know transferring to a PRSA was an option.

Thanks,
Ragazza.