Contributory Pension Calculation

[Jordan Belfort]

A friend has asked me what he might get in terms of the state contributary pension. I just wanted to double check my calculations

His date of entry to insurance is July 1976. He will turn 66 in July 2025. He will have have 49 years from first PRSI to retirement age.
He has 1533 reckonable and credited contributions.

• Under TCA method I calculated he would be entitled to 1533/2080 * €277.30 = €204.37
• Under average contributions he would have 1533/49 = 31.29 average contributions per year. That is in 30-39 bracket so he would be entitled to €249.30

In 2025 I think you would get 10% of TCA calculation and 90% of Average calculations
€204.37*.1 + €249.3*.9 = €244.80

Have I understood the calculations correctly ? Do these numbers look correct ?

 

[LDFerguson]

At a quick glance, the method looks perfect. A few quick points...

• State Contributory Pensions going up by €12 per week from January 2025, as per most recent Budget.
• His PRSI count stops at the end of 2024.
• Evidently there's gaps in his PRSI record over the 49 years. Any periods of caring for someone else? Paying national insurance in another country?

 

[ClubMan]

• Evidently there's gaps in his PRSI record over the 49 years. Any periods of caring for someone else? Paying national insurance in another country?

Also, any option for voluntary contributions?

Voluntary social insurance contributions

Voluntary social insurance contributions can help you qualify for a social insurance payment in the future. Find out more about making voluntary contributions.

www.citizensinformation.ie

 

[Forumuser]

A friend has asked me what he might get in terms of the state contributary pension. I just wanted to double check my calculations

His date of entry to insurance is July 1976. He will turn 66 in July 2025. He will have have 49 years from first PRSI to retirement age.
He has 1533 reckonable and credited contributions.

• Under TCA method I calculated he would be entitled to 1533/2080 * €277.30 = €204.37
• Under average contributions he would have 1533/49 = 31.29 average contributions per year. That is in 30-39 bracket so he would be entitled to €249.30

In 2025 I think you would get 10% of TCA calculation and 90% of Average calculations
€204.37*.1 + €249.3*.9 = €244.80

Have I understood the calculations correctly ? Do these numbers look correct ?

You don't say how many credits your man has- you just give us the sum of his credits and contributions.
Under TCA you can use only up to 520 credits from times of unemployment, ill health, etc. So there is the possibility that his TCA calculation is a bit different from your figure above.

 

[Kev1964]

• His PRSI count stops at the end of 2024.

I think that only applies to the Average calculation method and not TCA …….but I may be wrong.

 

[Jordan Belfort]

At a quick glance, the method looks perfect. A few quick points...

• State Contributory Pensions going up by €12 per week from January 2025, as per most recent Budget.
• His PRSI count stops at the end of 2024.
• Evidently there's gaps in his PRSI record over the 49 years. Any periods of caring for someone else? Paying national insurance in another country?

Thank you....Gaps are when he was in the US and there was an opportunity for voluntary contribution but that has long passed. Long story but stopped work 10+ years ago and never signed for credits or looked at voluntary contributions etc....

 

[Jordan Belfort]

You don't say how many credits your man has- you just give us the sum of his credits and contributions.
Under TCA you can use only up to 520 credits from times of unemployment, ill health, etc. So there is the possibility that his TCA calculation is a bit different from your figure above.

It's only a small number of credits so nowhere near the 520 limit. Thanks

 

[Jordan Belfort]

I think that only applies to the Average calculation method and not TCA …….but I may be wrong.

Thanks. I realized that after the post but I had two errors which canceled each other. I had calculated 2025 - 1976 as 49 years but that that would actually be 50 as they are inclusive........However I should only have calculated 2024-1976 inclusive which is 49.

I got the right answer for the wrong reason and so 49 was the correct divisor in the average calculation

 

[Purple07]

At a quick glance, the method looks perfect. A few quick points...

• State Contributory Pensions going up by €12 per week from January 2025, as per most recent Budget.
• His PRSI count stops at the end of 2024.
• Evidently there's gaps in his PRSI record over the 49 years. Any periods of caring for someone else? Paying national insurance in another country?

Where did you read or see that the PRSI count stops at the end of the previous year? I’m trying to get to minimum 520 by April 2025 and would need these last few months to do that.

 

[S class]

Where did you read or see that the PRSI count stops at the end of the previous year? I’m trying to get to minimum 520 by April 2025 and would need these last few months to do that.

When using the averaging method Prsi is only counted up to the end of the last complete tax year before the date of your pension claim.

However there is one exception to this rule.
If the Prsi contributions are necessary to help you reach the minimum 520 full rate paid contributions level, then these contributions are counted up to your pension claim date.

An extra year would be counted in the averaging calculation (2025) if you get the contributions for that year counted.

Be careful to check your average calculation as the extra year will reduce your yearly average.

If your pension calculation is calculated using the total contributions method, then all Prsi contributions up to your pension claim date are always counted

I have obtained all this information from DSP in writing a few months ago.

 

[Purple07]

When using the averaging method Prsi is only counted up to the end of the last complete tax year before the date of your pension claim.

However there is one exception to this rule.
If the Prsi contributions are necessary to help you reach the minimum 520 full rate paid contributions level, then these contributions are counted up to the date of your pension claim date.

An extra year would be counted in the averaging calculation (2025) if you get the contributions for that year counted.

Be careful to check your average calculation as the extra year will reduce your yearly average.

If your pension calculation is calculated using the total contributions method, then all Prsi contributions up to your pension claim date are always counted

I have obtained all this information from DSP in writing a few months ago.

Thank you for the info! Just what I needed to know.