PRSI on ARF count for COAP?

Thanks everyone for all the fabulous information, especially @S class

Id really appreciate if somebody could tell me if my assumptions are right below regarding my wife’s situation.

She stopped working 10 years ago and from a PRSI record she has:

1040 - Class A from 20 years employment
312 - From Homemakers (for age 6-12 of our youngest)

Therefore I make it that she is 728 short of the full 2080 (or 14 years worth of reckonable contributions).

She is 51, so what we are considering doing is converting her previous employment DC pension to an ARF and then drawing down €5000 per year for the next 14 years from the ARF to get the additional 728S contributions.

Am I right in then thinking that with her 1040A + the 312 Homemakers + the 728S that this would be the 2080 total that she requires for the 100% state pension??

All guidance gratefully accepted
 
Yes you are correct, she will reach 2080 and 100% pension.

If she has any investment income she might not need to drawdown the full 5000 euro per year from her ARF.

If for instance she had bank deposit interest of 1000 euro in a certain year she would only need to drawdown 4000 euro from her ARF in that year.

This would be useful if her ARF is not large enough to allow drawdowns of 5000 euro for 14 years.

She will also requalify for treatment benefits after approximately 2 years of paying class S Prsi.
 
Thanks @S class, great to get confirmation that we’re not doing something absolutely crazy

And great advice on the other income as she could put the tax free element of her pension into a deposit interest account as some paying close to 3%
 
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S class said:
Yes you are correct, she will reach 2080 and 100% pension.

If she has any investment income she might not need to drawdown the full 5000 euro per year from her ARF.

If for instance she had bank deposit interest of 1000 euro in a certain year she would only need to drawdown 4000 euro from her ARF in that year.

This would be useful if her ARF is not large enough to allow drawdowns of 5000 euro for 14 years.

She will also requalify for treatment benefits after approximately 2 years of paying class S Prsi.
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Appreciate any views on the following other avenue that I think might also be worth considering (totally based on your comments on another post )

Now I may well be misunderstanding the PRSI system but would the following make sense?

Rather than my wife using her ARF for 14 years to generate the required PRSI contributions, could she draw down the €5,000 for say 2-years (to get the PRSI benefits) and then aged 53 sign on for PRSI credits, not draw anything from the ARF until she is required to at age 60 and so let the ARF grow while still getting credits?

Drawing down the 4% from 60-65 would then give enough s-class contributions to benefit from the age-65 payments and then the full pension from age 66.

Just wondering if our thinking in this is possible?

Thanks for any views
 
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She can have a maximum of 520 Jobseekers credits Reckonable for the Contributory Pension. This is on top of her 312 Homemakers credits.

If she currently has no Jobseekers Credits she has the capacity to use Reckonable Jobseekers Credits for up to 10 years instead of class S from her ARF.

It would make sense to carry out the plan you described.

As she is out of the prsi system for more than 2 years she needs a minimum of 26 full rate paid contributions to get back into the Prsi system in order to qualify for Jobseekers credits.

If she initially gets 2 years of class S from her ARF she will satisfy this rule.

She would then need to get one paid class A contribution.
This is necessary as Jobseekers credits based on class S are not allowed.

After gaining her one paid class A she could then sign on for Reckonable Jobseekers Credits.

She should continue signing on for Jobseekers credits, at least up to the end of the calendar year of her 63rd birthday. This is necessary if she wants to qualify for Benefit Payment 65.

She won't qualify for Benefit Payment 65 based on the class S from her ARF.
The reason for this is because it is necessary to cease a self employment in order to qualify under class S rules.

In order to qualify for Benefit Payment 65 she would also need 13 weeks of paid class A contributions in any one of the calendar years of either her 61st, 62nd, 63rd, 64th or 65th birthdays.

She can have a mix of class A, class S and Jobseekers Credits in any particular year.

It's a good idea to be in both the class A and class S Prsi systems, as the rules for qualification for the Contributory pension and BP 65 could change in the future.

Keep all options open.
 
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