Personal and Occupational Pensions - my options?

T

tosullivan

Registered User
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I’ve been working with my current company since 2001


When I started back in 2001 I was paid through the UK division for a number of years so it was up to me to get a pension up & running so at the time I opened a personal pension and paid into it for a good few years (some subsidy from company aswell). A good few years later I was transferred to the Irish division and was eligible to join the company pension scheme here


So I ceased paying into the personal pension and it currently has a fund value of approx. €50k


The company pension scheme has been running fine for me for the last few years, I have been contributing 4% and company 6%. I have now started to add AVC’s and plan to add 4% AVC’s for the next year and gradually increase from there until retirement


Last Oct they stopped with the current DC scheme and started a new one, so I now have my personal pension pot, a DC pot and a new DC pot that will run I assume until retirement


Few questions:

  • Should I try to combine them all into the current DC scheme being run by the company?
  • Can I transfer the personal scheme pot into the occupational scheme?
  • If I cant transfer what are my likely options at retirement?

I'm currently 48

Thanks in advance
 
It's easy enough to transfer one work one into the other. As they are for the same employer, I'm surprised they aren't doing that anyway.

Personal pensions and work pensions aren't supposed to mix but you can do so by transferring it to a PRSA and then on to a work pension. But, it then becomes part of the work pension and its rules. By keeping it separate, you have the option of maturing it at a different time. It's quiet common for people to have a number of different pension plans, it gives you more options.


Steven
http://www.bluewaterfp.ie (www.bluewaterfp.ie)
 
Thanks Steven for the reply
Yes the personal one allows me to mature it at age 60 whereas I think the work pension is 65
I'll chat to them in a few weeks about the possibility of combing them

In terms of the tax free lump sum I can avail of when they mature, I am reading 2 different scenarios from what I can see
25% and 1.5 times salary
and max limit of 200k

DO you get a choice of either or does the type of pension dictate which one?
 
Under the Personal Pension you can take a lump sum of 25% only.
Under the occupational pension you have a choice:
- 25% of the Fund , or
- 150% of Salary (subject to having st least 20 years service).

If you go for the 25% option, then the balance can be invested in either an Annuity or an ARF (or a mix of both).
If however you go for the 150% of Salary option then you must use the remainder of the fund to buy an Annuity.
 
Thanks
so if I decide to take 25% of the personal fund at 60, does that mean at 65 when the occupational pension matures I can opt for 150% of salary?
 
Under current Revenue rules the answer is YES
But the rules governing pension plans are currently under review and may well change in the next 12 years.
 
Yes, you should be able to opt for the 150% option on the occupational pension. Each benefit from different employments/ personal pension policies can be exercised independently.

However you will only get the max 150% as a lump sum if you have 40 years service at retirement. As mentioned above you can get the 150% after 20 years on the uplifted scale. However you have to deduct off previous pensions from this amount to ensure that you don't exceed the maximum if you use this way of accruing benefits.
 
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