| Personal Pensions |
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What is a Personal Pension Plan?
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| A Personal Pension Plan allows you to build up a private pension fund to help ensure a more secure and comfortable retirement. |
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Who can have a Personal Pension Plan?
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A Personal Pension Plan is for people who are self-employed, sole traders or partners in a partnership, workers whose employer does not offer a pension scheme and workers who do not wish to join their employer’s scheme.
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What are the benefits of a Personal Pension Plan?
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| Personal Pensions are very similar to Standard PRSA’s. They do not have to adhere to the same rules on charges and terms, but they offer similar benefits. A Personal Pension is a form of investment designed to help you build up money for your retirement. |
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What are the differences between a Standard PRSA and a Personal Pension Plan?
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There are five main differences:
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| 1. | The level of charges – Under a Standard PRSA, the charges are limited by legislation. However, under a Personal Pension Plan there is no statutory maximum.
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| 2. | The choice of funds – Under a Standard PRSA, the choice of funds is relatively small (often around half a dozen options) – although it is normally wide enough to satisfy most people’s needs. However, under a Personal Pension Plan, the choice is much greater.
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| 3. | Employer involvement – If you are not offered membership of a company pension scheme, your employer must offer you the opportunity to take out a PRSA (as opposed to personal pension Plan) that the firm has selected. However, if you prefer to take out a different pension of your own choice, you may do so. |
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| 4. | Employer contribution –Your employer may contribute to your PRSA (although there is no requirement for this), whereas your employer is not allowed to contribute to your Personal Pension Plan. |
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| 5. | Membership of more than one type of plan – If you are (or become) a member of a company pension scheme, you may also contribute to a PRSA (and you will receive tax relief on your contributions). If you have a Personal Pension Plan prior to becoming a member of a company pension scheme, you can continue contributing to it but you will not receive tax relief on your contributions. Once you become a member of a company pension scheme you are not permitted to take out a new Personal Pension Plan. |
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| How much can I invest? |
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| Age | Limits | | Up to 29 years | 15% of net relevant earnings* | | 30 to 39 years | 20% of net relevant earnings* | | 40 to 49 years | 25% of net relevant earnings* | | 50 to 54 years | 30%** of net relevant earnings* | | 55 to 59 years | 35% of net relevant earnings* | | 60 years plus | 40% of net relevant earnings* |
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*Subject to maximum earnings of €262,382 p.a. under current legislation.
** The 30% limit applies, regardless of age, to certain categories of person that typically retire earlier than usual, such as athletes, jockeys, etc. |
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Call us on 01 - 8700 370 for more information
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 If you would like to arrange a consultation with one of our financial advisors, please click here. |
