Starting a pension plan is one of the wisest investment decisions you will ever make. There is no simpler, easier or more tax-efficient way of saving money for your retirement - and you're going to need a lot more money than you think to retire comfortably.
So what is a pension plan?
Pension plans are simply a very tax-efficient way of saving up a fund of money for when you retire. There are three main types;
- Personal Retirement Savings Accounts (PRSAs)
- Personal Pension plans
- Company Pensions
Getting more information
For more information take a look at our pension journey and our pension calculator
Could you retire on €12,000 per year?
The state pension is currently only €230.30 per week. Most people who retire at 60 can now expect to live for at least another 25 years. That’s a very long time to cover your day-to-day expenses without a regular income.
You can make regular payments or invest lump sums. You can add lump sums to your regular payments if you wish. These contributions qualify for tax relief, up to certain limits set by the Revenue commissioners.
Once you choose how much to invest, you can invest your payments in a pension fund of your choice. A wide range of funds is available to suit both the cautious and the more ambitious investor. The growth of your pension fund is free from tax.
When you retire, you will have a range of different options, including the possibility of taking a portion of your fund as a tax-free lump sum. You may choose to take an annuity from the fund that is left, or invest in an ARF. Both options are liable for income tax in the normal way.
Where to start
Why not try our Pension Calculator or have a look at our Pension Journey.
Pension can be complicated so we always advise that you talk to a Qualified Financial Advisor.