Being able to enjoy your retirement after a long career of working is a benefit that every person should be able to avail of. One of the key aspects in being able to get the most out of your pension is to understand and sort your pension.
Once you have a full understanding of your pension, you can really begin to plan and make the most out of these important years.
Unfortunately, there are many people in Ireland who can run into complications in regard to their pension. Here at Aspect Life, we want to help our clients get a better understanding and get the most out of their pension.
Our financial advisors are eager to help people start a pension and get the most out of this service. If you have any queries or require any advice in relation to your pension, get in contact with us today.
What is a pension?
A pension is a form of long-term savings that provides financial stability in your retirement years. By making pension contributions, you can save financially and then avail of this money once you reach retirement age.
You can choose to receive your pension in either regular payments or a lump-sum.
How do I get a pension?
You can choose how regularly you wish to make a pension contribution. Some people do it on a weekly basis, while others do it in a lump sum.
Any Irish person who is earning a professional income can get a pension.
If you require advice on how to start a pension, get in touch with Aspect Life today.
Types of pension
There are various types of pension that you can get in Ireland. They are as follows:
An occupational pension scheme will include contributions from both the employer and the employee. This may also be referred to as a company pension.
Occupational pension schemes provide regular income once you reach retirement.
Personal pensions can also be referred to as private pensions. These are when an individual puts their own money aside.
Personal pensions include Personal Retirement Savings Account, Annuity and a Personal Retirement Bond.
Examples of personal pensions include:
- Personal pension scheme: For the self-employed or those who are not offered occupational pension schemes
- Personal Retirement Savings Account: A savings account that can be used in different jobs
- Executive pension: For company directors and owners of businesses
- Additional Voluntary Contributions: Additional contributions to increase your pension fund
Public service pensions are set up by the government for employees that work within public service.
When you have an adequate amount of Irish social insurance contributions, you can qualify for Contributory State pension. It is provided to people in Ireland over the age of 66.
You are permitted to have other forms of income alongside your Contributory State Pension.
To find out if you have made enough Irish social insurance contributions, speak to our experts today.
You are permitted to receive both personal and state pensions and it is recommended to do so. You can improve your retirement fund through personal contributions, as well as receiving the state pension.
We also recommend that you investigate to see if your employer will offer an occupational pension scheme.
Some of the pension services we provide
There are a number of different services we offer our clients in relation to their pension. Of course, we can offer you advice on how to start your pension, save and which type of pension will suit you best.
However, we also offer additional services such as pension tracing and pension transfers.
Unfortunately, it is not uncommon for people to lose payments they have made in previous jobs towards their pension. At Aspect Life, we offer pension tracing to avoid this.
Pension tracing is when we seek out any potentially lost payments you have made in the past and make sure you get the correct payment.
From the age of 50, you can access up to 20% of your pension or €200,000, whichever one comes first.
This pension withdrawal is a tax free lump sum, making it a great option for people looking to access cash.
Pension withdrawals are commonly done to pay off mortgages, fund special oceans such as a wedding or pay off other outstanding loans or unexpected large bills.
No matter what age you are, it is never too late to start a pension. If you have yet to start your personal pension, speak to Aspect Life today to discuss your retirement goals, and we will help you set up a pension plan to help you achieve your goals.
Moving your pension is known as a pension transfer. This is a service we can provide our clients.
People may choose to transfer their pension if they wish to have all of their savings in one place, move to a different pension provider or get early access to your pension.
Standard Fund Threshold
Although you can get tax reliefs on your pension, there is a limit of the value in which you can avail of these reliefs. This is known as the Standard Fund Threshold.
The current Standard Fund Threshold is €2,000,000. This means value exceeding this number will be taxed at the higher rate of 40%.
Defined benefit pension and defined contribution pension
A defined benefit pension will give the recipient a fixed pension payment annually throughout their retirement.
Defined benefits pensions will pay into a pension pot alongside your state pension. The purpose of this is to provide people with a high standard of living throughout their retirement.
A defined contribution pension is more commonly seen than a defined benefit pension. This is when both employees and employers make contributions to the pension fund.
Contributions will be removed from your salary on a regular basis.
Employers will commonly match your contributions to your pension. This means if you are making contributions of 5% of your weekly salary, your employer may make the same pension contribution.
Employers use defined contribution as a pull factor for employment.
Speak to Aspect Life today to find the best option for your retirement goals.
Enhanced Transfer Value
An Enhanced Transfer Value (ETV) may be offered to people to try and encourage you to move from a defined benefit scheme to defined contribution scheme.
An ETV is made by a company to try and get members out of a defined benefit pension scheme and can increase your pension package significantly.
The benefits of an ETV come in the form of more value in your pension and the ability to grow your fund in the future.
If you have any queries regarding an ETV, speak to our pension experts today.
Get pension advice today
Our dedicated team at Aspect Life is eager to help our clients get the best result from their pension. So no matter what area of your pension you need advice with, do not hesitate to get in touch with our advisors.
Our qualified advisors can help to provide you clarity, without any obligations or fees. We can help you get the outcome you and your family deserve.
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