Irish Pensions | The Complete Guide for Beginners

[@malone_financial]

Subscribe if you found the video helpful! This video was filmed as part of Pensions Awareness Week 2022 at the Aviva stadium in conjunction with Moneycube! Present on the panel are Dan Malone (Malone Financial), Claire Louise Murphy (Aviva) and Aran O'Toole (Moneycube).

[@tonybarrett8543]

This line about free money and the Government giving you something for nothing is indicative of the poor financial mindset in Ireland. The money is ours and is taken by the Government.

[@gerkelly7539]

Class overview as always Dan

[@malone_financial]

Cheers Ger

[@keitho77]

Any chance of a video covering self administered pensions? Thanks.

[@malone_financial]

I can add it to the list

[@pet_cow_5452]

Fantastic presentation! Great vid

[@malone_financial]

Thank you! Appreciate it

[@darrenmcinerney2212]

Great stuff Dan, thanks very much 👍👍.

[@malone_financial]

Cheers Darren

[@LeoCryptoMan2024]

Great videos Malone.

[@welshhibby]

Great presentation !

[@malone_financial]

Cheers!

[@robbiebroughton869]

Great Video! Can I ask, when looking at options to start a pension are there options that do not charge a management fee?

[@williamryan6618]

Excellent video really helpful thanks all

[@engrwaqarmarwat]

Great video. 👍 I have a question about drawing down pension. What age are we allowed to draw down our pension. I know 67 is the official age for govt pension, but what about private ones ? Thanks

[@malone_financial]

Cheers Waqar! Drawdown from private pension is possible from age 60. Voluntary early retirement is also possible for both occupational schemes and personal pensions from age 50 which can allow you to access your pension earlier.

[@kensull100]

Great video. Do employers get any benefits when matching the employee's contirbutions?

[@malone_financial]

Cheers Ken! Yep, employer contributions are tax deductible for corporation tax. They also don’t have to pay employers PRSI or USC on the contributions either.

[@oGINGERNUTSo]

Will my pension affect any benefits i could be able to receive? Can i receive my pension in full for any emergency reasons, or will it be dribbled out to me?

[@davidmartin3163]

Great videos thanks. Is it possible to invest in low cost index funds that you recommend in some of your other videos through your Irish pension? This would be to avoid capital gains tax every 8 years by keeping it within your pension tax free and to avoid high annual pension management fees like contribution fees and annual fund percentage fees of institutions.

[@malone_financial]

Cheers David, appreciate it! Yes there are providers out there who allow you to self-direct your investments into ETFs. That's not to say that they come without their own share of fees and charges however (in addition to the fees and charges of the ETFs which you're investing in).

[@oGINGERNUTSo]

Pension is classed as income. If you withdraw a lump sum, it's classed as savings so you wouldn't receive your state pension and could lose out on other benefits, and it's not free money. it's your money.

[@simonkoch4251]

Hi Malone, thanks for that very informative video. I have a question. Do you know what happens to my PRSA account when I move to another country?

[@cinta-cs4cd]

are the pension contributions protected by central bank? for example I was saving money in CU. the CU went into liquidation. the members savings were guaranteed by the central bank with a limit of 100k

[@malone_financial]

What you’re referring to is the Deposit Guarantee Scheme (DGS) which applies to deposits with banks, credit unions etc. Pension contributions aren’t being placed on deposit, they’re being invested in what could be a wide variety of assets. There is a scheme called the Investor Compensation Scheme (ICS) which can compensate you up to a maximum of 90% of your net loss (max €20k) in certain scenarios.

[@majellatarbatt1424]

@@malone_financial a

[@BricksBlocksMocs]

Can you open a Prsa as long as you have resident ? Even if your unemployed or on certain payments ? Is there anything to look out for?

[@malone_financial]

Yes but the PRSA can only be funded from your employment/self-employment income

[@kamilszos4860]

so to get AVC tax relief on my PRS? must the payment be made before October 31st? I'm asking because I set an annual payment of €2,000 but it turned out that I would earn much more and I wanted to transfer the entire payment subject to 40% tax to my PRSA account

[@Gumbi1012]

Do employee pension contributions count towards the 20%/salary tax relief? In other words, if an employee contributed pays 10%, am I limited to contributing a further 10% maximum to avoid the tax, or does it not affect it? Hopefully that's clear. To state it differently, in that example, I could do an AVC of 20% myself, and still benefit from the tax relief even if the company contributes over and above that 20%? Or no?

[@veronicat1834]

Can I start a pension through my work even though my boss doesn´t offer a pension? I heard if I do it through work (even though the company wouldn't give me any money towards that) the money goes into my pension before taxes but my boss needs to do that and it doesn't cost him anything?

[@dimasguiop6536]

Thanks for the video, it’s very insightful, I have a question, how much time one should work in order to get a decent pension, is there a number of years to have the rights to receive a pension, or there is an specific amount of money, that one gather over the years that gives the right of receiving pension? Or it doesn’t matter. We wanna move to Irland in the near future, and we are in our forties, will appreciate your answer. I’m a physician and my wife is an accountant. Thanks again.

[@malone_financial]

Most private pensions in Ireland are defined contribution (what you get out largely depends on what you put in). You can build up an entitlement to the State pension as well through working (max ~€13k per year pension in retirement)

[@dimasguiop6536]

13K per year, for how many years? Is there a minimum of years?

[@IwasBraveFor2WholeSeconds]

What's the point having an additional pension when the state will consider it as part of the test means, one of them is going to be subjected to heavy taxation.

[@oGINGERNUTSo]

Yes, I agree. When my father passed away, my mother received his pension, and she lost a lot of benefits and was worse off financially. State laws could change by the time you receive your pension what protection or guarantees are in place to protect yourselves.

[@andreas6029]

In my work contract state the retirement age as 65 , means I can draw my state pension and private one?

[@malone_financial]

The full State pension becomes available from the age of 66 provided you have enough PRSI contributions. A private pension is separate to the State pension and is based on contributions that you (and perhaps you employer) have made over the course of your working life. Private pensions can be drawn down from age 60 onwards (and potentially even age 50 in the case of voluntary early retirement). You can draw down from both the State pension and a private pension(s) provided you’re at the required age for both.

[@andreas6029]

Thank you for replying. Your content is stellar.

[@malone_financial]

@@andreas6029 thank you, appreciate it

[@ACelt.]

In a company pension do they save or invest your contributions.

[@malone_financial]

They will invest your contributions. What they invest in will vary from scheme to scheme but you will be able to get your hands on that information from your employer.

[@christinedianeguillena6721]

Can I ask how is the private pension different from the HSE pension? I am not Irish so I have no idea about this but I work as a nurse in HSE and would like to transfer to a private hospital. Not sure if it's a good idea re to pension.

[@declanmcardle]

Check your employment contract to see what sort of pension you have already. And HR department. HSE employees (I don't know for definite) probably get whatever the Department of Health offers. Google department of health pension Ireland or similar search terms. These days all your pensions travel with you, you don't lose them or anything. You'd just start contributing to a new one in the new job/employer...

[@TheMatviey]

On my payslip I see “pension” and “avc%”. What is avc?

[@malone_financial]

Additional voluntary contribution (AVC). These are the additional payments you make to your pension above what is stipulated in your employment contract (if any)

[@Cleisthenes607]

I'm not Irish but I was curious as to what the Irish equivalent to the UK S&S ISA where you can invest 20k a year and thereafter no tax on capital gains or dividends and you can withdraw whenever you want. So I assumed you guys would have something similar only to be shocked and appalled that you live under communism. This rule though takes the cake, the deemed disposal rule. On the 8th anniversary of your initial investment, you will be required to pay 41% (exit tax) on the gains and income you have made to date even if you have not disposed of your investment. The Exit tax rate of 41% and the deemed disposal rule applies to all of the following types of funds: ETF - Accumulating ETF - Distributing Investment Funds/Life Policies So my VUSA investment would see me with a tax bill of tens of thousands of euros even if I haven't sold out of it. How have your people not had a revolution yet? It's literally evil.

[@carrie20074]

I was just wondering about this too. If i have for example £25k in an ISA and move back to Ireland where i am Irish domiciled do I have to pay 41% on the £25k or 41% on the capital gains?

[@Cleisthenes607]

@@carrie20074 Everything inside the ISA wrapper is tax free so my assumption would be there would be no tax liable but you would no longer be able to add any more to your ISA. I would however check with an Irish financial advisor rather than take my advice as gospel.

[@bighands69]

@@carrie20074 You need to seek professional tax advice. Just pay a consultancy fee as a one off to get the advice.

[@bighands69]

@@Cleisthenes607 Ireland is not communist it has welfare state mentality at the cultural and government level.

[@Cleisthenes607]

@@bighands69 Yeah people in Dublin can't afford housing, great welfare state over there. And every young Irish person I meet wants to get out to places like the US or Australia. Things need to change or it'll be a country of old people.

[@UAP]

is there a strategy to get your pension early?

[@malone_financial]

The earliest withdrawal is age 50 upon voluntary early retirement. Age 60 is the most common. No hidden strategies to get the full pension out before then

[@UAP]

@@malone_financial that's unfortunate. Thanks for your answer

[@Edward_Joseph_]

So this in addition the state pension?

[@malone_financial]

Private pensions are in addition to the State pension yes

[@oo7sam]

Max out your pension and work only 15 years, You will have 1 million € in you pension fund. 😂

[@malone_financial]

I don't know about that now, but yes they're very valuable!