Help with calculating pension entitlements - public sector worker

Anyone know the ph number of DSP to request PRSI Contribution statements ?

It's DSP Buncrana you need to contact (phone and email address included in the above list)

I phoned the ETB I work in to enquire about NSP. The pension person had never heard about it so I had to explain to her what it was about!

She came back 3 months later having done some homework on it.

I get paid through a centralised system called core portal. I can view my pay slips and sick day entitlements. There is a section for pension but there is no information in there apart from a date for my retirement which is wrong - it is listed as age 65 when it should be 60.

Unions have been poor enough on this - only interested in promoting Cornmarket!

More needs to be done for public sector workers to facilitate proper financial planning for retirement.

Good luck with your efforts to find answers

sidzer said:

Unions have been poor enough on this - only interested in promoting Cornmarket!

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I agree. I cannot understand why Cornmarket is promoted so heavily. I can get better value for car insurance when I ring around as an individual rather than using Cornmarket as a broker with the buying power of tens of thousands of public servants. I also don't think their AVC charges are particularly competitive!

Right, so my wife got her contribution history from DSP.

She has 26 years of Class D contributions to 2022 (2023 hasn't been updated yet), so will have 32 yrs at age 60 [NRA].
(She also has 89 Class A from various other work over the years)

Am i right in the following calculations - for pre-95 entrants
- Max pension Lump Sum would be [40 x 3 x Final Salary]/80 - assuming final salary is 45k then lump sum would be 1.5 x 45 = 67.5k
- Max pension income would be [40 x Final Salary]/80 = 22.5k pa

The 8 missing years would mean...
- Pension Lump Sum would be [32 x 3 x Final Salary]/80 - assuming final salary is 45k then lump sum would be 1.5 x 45 = 54k (shortfall 13.5k)
- Pension income would be [32 x Final Salary]/80 = 18k pa (shortfall 4.5k pa)

To make up the shortfall (with 6 years to go) should she...
a. buy back the 8 years (how much would that be?)
b. Take out a PRSA AVC (is 6 years too short a time-scale for this?)

I don't know anything about buying back years.

If she retires at age 60 she has the potential to gain full rate paid Prsi contributions up to age 70.
She currently has 89 A.
If she gained 52 contributions from age 60 to age 69 this would gain her 468 extra full rate paid contributions.
This would bring her to a total of 557 and would allow her to qualify for a partial state contributory pension.
She can achieve these extra contributions by either taking up class A paid employment at age 60 or drawing down a minimum of 5000 euro per year from an ARF.
If she takes up class A paid employment at age 60 for a minimum of 1 week she would gain 2 years of change of status credits. This gives her an extra 104 class A credits.
Her total of reckonable contributions would now be 661.
A full deferred pension at age 69 is 320.30 euro. She would qualify with her level of contributions for a partial payment of 101 euro per week.
If she doesn't intend working beyond age 60 and decided to use an ARF, she would need at least 45000 euro in AVCs after claiming any extra tax free lump sum available to her. She would just need 1 week of employment to secure her change of status credits.

Maybe she could manage this in addition to buying back extra years in the next 6 years.

She could also, after working at least 1 week at class A, make full rate voluntary contributions up to age 66 and possibly up to age 70. These would cost her 500 euro per year.

She could possibly make out a plan if she had less that 45000 euro in her ARF to mix Voluntary Prsi for some years with ARF drawdowns of 5000 euro for other years.

Thanks S Class ! Still trying to get my head around the numbers!

A PRSA AVC seems a good option to have even when started at age 55

Do the benefits from a PRSA AVC have to be taken at the same time as when she retires from her main employment (NRA 60), ie Pay into PRSA AVC for 6 years

or can she keep the AVC until say 66 ?

I reckon she'd need a min pot of 58,500 in a AVC to match the lump sum shortfall (13.5k) and leave the remaining 45k into a ARF....
(So pay in 9,750 pa for 6 years or 6,318 pa over 11 years, to 66)

Buying back 8 years would cost over 20k pa from a salary of 45k !

From https://www.publicservicepensions.gov.ie/en/modellers/

redstar said:

Do the benefits from a PRSA AVC have to be taken at the same time as when she retires from her main employment (NRA 60), ie Pay into PRSA AVC for 6 years

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Yes. But she would only need to withdraw a minimum of 4% per year.

She can only make AVCs until her retirement date from her employment. (probably age 60). She can make backdated AVCs for 2023 up to 31 October 2024.

I don't know if voluntary contributions can be made after age 66.
Assuming they cannot and the remainder in her ARF was only 20000.

She could make minimum withdrawals of 800 euro per year from her ARF until age 66.
During this time she could make voluntary Prsi contributions based on her class A contributions.

After age 66 she could make ARF withdrawals of 5000 per year for 52 class S Prsi up to age 69.

This would give her the necessary extra full rate paid Prsi contributions she needs.



I made a mistake in post #26 in adding in her change of status credits.
She would get the 2 years of change of status credits but assuming that she gets full rate paid contributions in the year she ceased employment, these paid contributions would overlap with that years change of status credits.
This would cancel out that years change of status credits.
You should only calculate an extra 52 change of status credits.
She might also have some pre entry credits.
So her potential contributury pension would be slightly lower than I estimated.

"If she doesn't intend working beyond age 60 and decided to use an ARF, she would need at least 45000 euro in AVCs after claiming any extra tax free lump sum available to her. She would just need 1 week of employment to secure her change of status credits."

Just to clarify this - she can't just go from Class D employment if retiring at 60 to Class S (from ARF withdrawals of 5000e pa over 9 years) to help qualify for the contributory pension. Is that correct? She must do a change of status by Class A type employment first.?

She can go straight from class D to class S from an ARF.

The class A is an optional extra.

The employment at class A is to gain extra backdated change of status credits.
This would convert her existing class D in her retirement year and the previous year to class A credits.

This would increase her total number of reckonable Prsi contributions and therefore increase the amount of contributury pension she could qualify for.

For a small amount of effort she could get a considerable amount of financial benefit.

Thanks for clarifying S Class ! Invaluable as ever!

So, she could improve her position as follows;

- currently is in Class D employment and wants to retire at 60
- At 60 will also have 86 Class A 'stamps' from a previous job years ago
- Take out a PRSA AVC plan to build up at least 60k by age 60 (is age 55 at next birthday)
- Take 15k lump sum and put remainder 45k into an ARF
- Withdraw 5k per year, 60 to 69 - This creates 52 x 9 = 468 Class S stamps
- Take up a Class A job temporarily to gain 2 x 52 Class A stamps via 'change of status' : 2 x 52 = 104
- By age 70 will have 86 + 468 + 104 = 658 reckonable contributions and so would be entitled to a pro-rata State Contributary pension.

Is that a do-able plan ?

What would the pro-rata pension be worth ? Is it 658/2080 (31%) , [I guess e337.20 x 0.31=106 per week, which is just over 5.5k per year, so essentially replacing the ARF?]

Yes that plan is doable. She probably would only gain 52 change of status credits. This is because if she immediately starts her ARF in the year of her retirement the change of status credits would overlap with the class S from the ARF for that year.
Your calculation method is correct.
She would be claiming a partial pension. A pro rata pension calculation only applies if she had between 260 and 519 full rate paid prsi contributions.
She would probably also have some pre entry credits from her first year of employment.
She would ideally need slightly more than 45000 in her ARF to allow for yearly ARF fees, assuming she invests in a low risk low gain fund.
In a worst case situation where her ARF depleted to much to allow for a 5000 euro drawdown in the 9th year, she could top it up with some extra cash.
She would not be able to claim tax relief on the extra top up.

Right, partial pension so.
I suppose some of the TFLS could be used to top up the 45k ARF if necessary (or take less TFLS?)

So do you mean its possible to top up an ARF from your own funds/cash-savings and not from just from whatever AVC value was available when the ARF was created?

redstar said:

Right, partial pension so.
I suppose some of the TFLS could be used to top up the 45k ARF if necessary (or take less TFLS?)

So do you mean its possible to top up an ARF from your own funds/cash-savings and not from just from whatever AVC value was available when the ARF was created?

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Yes you could use some of your own funds as a last resort.

A couple of thoughts on this...

1. Does drawdown of an ARF trigger a change of PRSI status similar to switching to Class A, from Class D?
ie after the first Class S (ARF) payments would she gain 52 change of status credits ? So, year 1 of ARF gets 52 Class S plus 52 S stamps due to status change?

2. Instead of drawing down 5000 per year from an ARF for 9 years, could she draw for, say 2 years, and then buy Voluntary PRSI Class S at 650 per year up to age 69?

The other point is that she can probably obtain her occupational pension at 60 without an actuarial reduction. This would be also something to confirm with her pensions office, not withstanding the difficulties so far.

Does she use CORE or a similar payroll system. We have it in our public sector organisation and it is up to date as I would have chased up years ago and got the service transferred into my current employer.

For me on Core there is a manager and employee screen, On the employee screen there are sections like pay etc and on that page is the pension as well Not every organisation will use the CORE pensions module, but it should list all the service that they have a record of.

1. No, change of status credits are not applied to class S Prsi.
She would need 1 paid class A contribution to trigger the change of status credits.

2. If she gets the 1 paid class A she could pay voluntary Prsi based on class A instead of class S. Class A voluntary contributions are still 500 euro per year, if she has minimal class earnings the previous year. She could make voluntary class A contributions starting on the next full calendar year after her retirement year at a cost of 500 euro per year.

For this to work she would probably need to avoid gaining class S until after she plans to stop voluntary contributions.

She could also do as you state by lowering her ARF to below 5000 euro per year and then paying 650 euro per year. She could also restart class S at any time after paying class S voluntary contributions.

Voluntary contributions can be made up to age 70.

S class said:

1. No, change of status credits are not applied to class S Prsi.
She would need 1 paid class A contribution to trigger the change of status credits.

2. If she gets the 1 paid class A she could pay voluntary Prsi based on class A instead of class S. Class A voluntary contributions are still 500 euro per year, if she has minimal class earnings the previous year. She could make voluntary class A contributions starting on the next full calendar year after her retirement year at a cost of 500 euro per year.

For this to work she would probably need to avoid gaining class S until after she plans to stop voluntary contributions.

She could also do as you state by lowering her ARF to below 5000 euro per year and then paying 650 euro per year. She could also restart class S at any time after paying class S voluntary contributions.

Voluntary contributions can only be made up to age 66. After age 66 she would need class S from her ARF or paid class A from employment to increase her Prsi record.

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I note comment re 'minimal class earnings in the previous year'

Using redstar's example (Posts 10 & 25), at 60, based on potentially 6 more years 'full service' and without buying back years or an AVC:
- Pension income would be [32 x Final Salary]/80 = 18k pa (shortfall 4.5k pa)

In this particular scenario are Voluntary Contributions not calculated as 6.6% of reckonable income, which in this case would include a public sector pension?

Does this not imply that Voluntary Contributions amount to (18k x 6.6%) = 1,188 pa ?

Voluntary prsi is calculated on the relevant income.
If she is making Voluntary Prsi contributions based on class A, only class A earnings are counted to determine the rate of payment. So if her class A earnings are below 7575 euro she will pay 500 euro.

The rules for Voluntary contributions were updated on 2nd August.
They can now be paid up to age 70.