Percent of income to pension ratio

O

OnLooker

Registered User
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Hi,

Just turned 27 & I have decided to start my pension as I am now eligible to join our company scheme.

The company contributes 5% of Salary. I am on €45k.

I intend to contribute 12% of my salary which is €5400.

I am right in saying this will cost me €238.50 after tax relief?

I already have a house with my sister but intend to buy my own in the coming few years.

I save €1500 a month already & have €35k in savings built up.

Is 12% of salary a good starting point?

Thanks in advance.
 
Just turned 27 & I have decided to start my pension as I am now eligible to join our company scheme.
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How come you are just eligible now. Have you just joined the company recently and were on probation till now.

I am right in saying this will cost me €238.50 after tax relief?
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Yes.

I already have a house with my sister but intend to buy my own in the coming few years.
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You realise that you will not be treated as a first time buyer and may have to pay stamp duty on the purchase unless it is a new build.

I save €1500 a month already & have €35 in savings built up.
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This implies that you have been saving for 2 years, so can be used for stamp duty if necessary.
I intend to contribute 12% of my salary
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Just make sure it is not a PRSA. If it is, the total contribution (emplorer & employee) for your age cannot exceed 15% to reclaim tax relief.
If is it not a PRSA then you should be OK
 
Only joined the company 6 months ago.

Yes I know I will have to pay stamp duty next time round if I don't purchase a new build below 125 sq metre.

Its a defined contribution pension scheme, what way this effect the 15% for tax relief. Can I still pay 12% and the company 5% & receive full tax relief?
 
Yes 12% and 5% is allowed in that scenario (once it is an Occupational Scheme and not a PRSA).
 
Depends on what you call a good pension.

Also depends on investment returns over the period to retirement and annuity rates at retirement.

Does your firm have a pension consultancy to answer these questions?
 
MMilken said:
Depends on what you call a good pension.

Also depends on investment returns over the period to retirement and annuity rates at retirement.

Does your firm have a pension consultancy to answer these questions?
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They are brutal to be honest. They are advising funds they aren't performing.
 
They should still be able to answer your questions no problem.

If they are not up to the job, you could use the Pensions Calculator on the Pensions Board website to get a feel for how you will do if you put in 12% and 5%: www.pensionsboard.ie
 
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