Married couple seeking pensions advice

Hi All

My wife and I are both 32 and we're both employed. She's a public servant earning circa €60k per annum. She has accumulated around 12 years service and has scope to purchase notional service of circa 1 year. She also has circa €6k of AVCs accumulated but no longer contributes to this scheme.

I work in the private sector and earn circa €110k per annum. I'm a member of a defined contribution scheme whereby I contribute 5% of my annual salary to the scheme and my employer contributes 8%.

It's a broad question I know, but what should we do to optimise our retirement options?

Thanks in advance for any assistance.

Sean

Your public servant wife seems to have sufficient service - by retirement- to qualify for the max pension. However it probably depends on the particular scheme, but if she has max service ( circa 45 years) I would suggest hat she will have very limited scope for AVC's.

As for you, a total contribution of 13% is reasonable at this stage. But you should look up the Pensions Board calculator to check what 13% p.a will likely provide. It will not provide maximum benefits, but remember that based on your salary you need to remember that there is a max fund of €2.3m currently (though hopefully that might increase by the time you retire).

Could I also suggest that you think about the death in service benefits. What would be the financial impact in the event of either of you dying prematurely? Also what about the financial impact of disability and being unable to work?

Thanks for your help.

There's some kind of policy here whereby my wife / dependents get four times my salary in the event that I kick the bucket. There's also something to cover inability to work.

Intuitively, I would have thought that I should start contributing the maximum for my age to the DC scheme?

Thanks again.

Hi Sean

Just reading your post and I may be of some help. The 4 x salary is a form of life cover most likely covered by a group risk arrangement. The money in the case of an ability to work is called phi or permanent health insurance. This will most likely cover between 50-66% of salary dependent on how it is set up. This is paid out after a deferred period usually 26 weeks (after your employer stops paying salary while your out sick)

When you say your wife is 32 with 12 years service, she will have another 33 years service up to age 65, only 40 years service is counted for calculating public sector pensions, she would not be advised to purchase a years notional service as only 40 will count. I would need to know what rate prsi she currently pays before I make that call but that is dependent on her normal retirement age being 65. If you want to discuss further I would be happy to help