When do you plan on retiring...?

Icsics

One of my colleagues recently retired & it came as a huge surprise because she wasn't necessarily the 'age' or next according to 'service'. But the amount of change & increased workload meant she felt that enough was enough. This has got all the rest of us thinking! So how do people go about getting ready to retire to maximise the pension? Any tips appreciated!

rainbowtrout

It probably depends a lot on a person's circumstances too. Is there a spouse's wage coming in? Children in school/college? Mortgage or other substantial loans to be paid off? What age were they when they started teaching? Career break, periods of unemployment/casual subbing, job share, unpaid leave (particularly for women). School environment can have a role too. Some schools are tougher than others to teach in. Having a post can add to pension and allow a person go a couple of years earlier than a teacher who doesn't have a post.

I will have 33 years done when I hit 55. I'm a textbook case. Started in a permanent job at 22, so I can go then, albeit without full pension. That's about 15 years from now. I have no idea how I will feel in 15 years time about the job and whether I will want to go then or hold out for full pension at 62.

evolving_doors

When they change the junior cycle to the latest failed initiative... that's the time to leave.

spurious

I went early a few years ago.

The absolute last straw (for me) was the S&S being extended across the board. I always maintained it was doing younger and small contract teachers out of paid work and i was not going to be part of that, having previously opted out.

I was lucky that due entirely to an accident of birth, I was born in a time which allowed me to be able to afford buy a house on my own. The house was paid off and I owed nothing to anyone.

As the great Swedish philosophers Abba said 'it just wasn't fun anymore', so it was time to go.

Money is fairly tight, but I do bits and pieces to add to the very small pension. I don't miss it at all.

endacl

I’m out the door at 55. I’ve a second part-time career that I’d like to make full time. Teaching is my pension, so, as soon as the numbers make sense, I’m gone. 55 is an upper limit!

maynooth_rules

I would have quite happy teached until I was 65/66. But to be utterly blunt, the shambles they have made with 'Junior Cycle reform' has turned me off the profession. If, and I would be fairly certain it will, LC reform goes down the same route then I would hope to get out as soon as I can clear my mortgage and live reasonably well.......which will probably be 67:D

Icsics

Thanks for the replies & I know a lot depends on personal circumstances. I indeed on going to the retirement seminars in Nov. Can I ask people who have retired, what should the first step in planning it be? What section of the Dept do I ring?

Simple_Simone

Icsics wrote: »

Thanks for the replies & I know a lot depends on personal circumstances. I indeed on going to the retirement seminars in Nov. Can I ask people who have retired, what should the first step in planning it be? What section of the Dept do I ring?

Info is all here:-

https://www.education.ie/en/Education-Staff/Services/Retirement-Pensions/

Why would you need to ring them? If you want a pension forecast, you can do it online at this link:

https://www.education.ie/en/Education-Staff/Services/Retirement-Pensions/Pensions-Modeller/Pensions-Modeller.html

Icsics

Simple_Simone wrote: »

Info is all here:-

https://www.education.ie/en/Education-Staff/Services/Retirement-Pensions/

Why would you need to ring them? If you want a pension forecast, you can do it online at this link:

https://www.education.ie/en/Education-Staff/Services/Retirement-Pensions/Pensions-Modeller/Pensions-Modeller.html

Great thanks, was just looking for a starting point!

doc_17

Post 04 so if want 100% of my pension I have to go until I’m 66.

But I’m bailing at 60. It’s not a job I’d like at that age

honeybear

I'd love to go at 56-I'll only have 30 years service so I really need to think about possible AVC's & increased savings. I've no dependants but would love to enjoy my latter years. I know of 2 healthy ladies who retired on full pensions who died unexpectedly months after retiring. I'd love to hear from anyone who retired very early.

Icsics

From what I gather 33 is the magic number, at least that's what everyone in my school is aiming for!

rainbowtrout

Icsics wrote: »

From what I gather 33 is the magic number, at least that's what everyone in my school is aiming for!

Ya, that's the going in at 22 and leaving at 55 with 33 years service and pension being paid out. Can still mark for the SEC in the summer if you're into that, or take a part time job with no stress doing something completely different.

solerina

I would love to retire before 60, so 58 or 59. Have been paying AVCs for about 15 years now so I can do that, almost everyone on staff here have retired before they turned 59 so I feel it’s not really a job for the over 60s.

Icsics

solerina wrote: »

I would love to retire before 60, so 58 or 59. Have been paying AVCs for about 15 years now so I can do that, almost everyone on staff here have retired before they turned 59 so I feel it’s not really a job for the over 60s.

Can I ask did you organise your AVCs through Cornmarket or Dept? Do they relate only to lump sum?

doc_17

Ene. With AVS it’s hard to retire early if you are Post 04

mtoutlemonde

doc_17 wrote: »

Ene. With AVS it’s hard to retire early if you are Post 04

Why is that?? Had Cornmarket telling me that I would need AVCs to make up the years I was retired prior to receiving the old age pension??

Squatter

Icsics wrote: »

Can I ask did you organise your AVCs through Cornmarket or Dept? Do they relate only to lump sum?

You can't arrange AVCs through the Department. Although you may be able to buy added years. Look for threads here and on a well known financial forum about whether AVCs or the purchase of service is the better way to go. Don't just rely on the Cornmarket sales consultant.

doc_17

mtoutlemonde wrote: »

Why is that?? Had Cornmarket telling me that I would need AVCs to make up the years I was retired prior to receiving the old age pension??

You don’t get the State Pension until you’re 68. So you’d only be in 12k plus whatever your avc gives you, probably 10-12k depending on how lucky you are and how much you put in

solerina

Icsics wrote: »

Can I ask did you organise your AVCs through Cornmarket or Dept? Do they relate only to lump sum?

I have them through Cornmarket, I won’t have paid in 40 years pension contributions so the AVCs will make up the shortfall in both my lump sum and in the pension payments themselves.
I possibly have enough paid in already to stop them now...that’s one thing I am not sure about though !! Does anyone know ??

trihead

You can buy back years 'notional service' (most can) This is one of the best ways to go early on a full pension or to increase your years. Its not cheap but its tax deductible.

Icsics

trihead wrote: »

You can buy back years 'notional service' (most can) This is one of the best ways to go early on a full pension or to increase your years. Its not cheap but its tax deductible.

Thanks, how do I go about this? Can I do it for years spent teaching abroad?

Bobtheman

Going at 60. By then the entire thing will be wrecked. Lambs to the slaughter my fellow teachers. Always amazes me how tough people are in the classroom but have their spine removed or their balls when it comes to standing up to preventing their conditions deteriorating.

I'd plan a few years out. Be fully informed of pension etc.
I plan to have a second income on stream by time I leave

Teacher0101

Good point Bobtheman.

Last year we had lunchtime strikes with placards - totally ineffective and stupid.
There are loads of young teachers who are afraid to speak out lest they get a 'bad name'.

All 5th and 6th years in my school are going to protest about global warming on Friday.
Good ol Leo doesn't say we should protest about current education system though, eh?
Not much street cred in that for him.
We are professionals and can't organize a protest?

I would strike for a week, just walk out - even without pay, and look at the carnage on mothers and fathers faces. Maybe then young teachers wouldn't be subjected to abuse from stay at home mothers who believe their kids would never lie.

I'd be there til I'm 68. I'd stick it out and do **** all. Just to piss them off.

Coming off the inservices, teachers are just a little naive when it comes to workload. Take it easy - these things fall into place. It's highly stressful if you're doing too much. Hey, they all pass in the end - so why bother with the kids who don't care themselves.

gaiscioch

trihead wrote: »

You can buy back years 'notional service' (most can) This is one of the best ways to go early on a full pension or to increase your years. Its not cheap but its tax deductible.

You will also be penalised if you decide to go earlier, which is a huge downside to notional service. If you are certain you will last until the age you agree, go for it, but I went for AVCs as they were more flexible on that important point. I had planned on notional service but when the financial adviser showed me a graph with the penalties if I decided to go earlier, it made no sense. Everybody here should be going away and paying a small fee (I paid €150) for independent financial advice so that they are informed about all these products.

gaiscioch

Squatter wrote: »

You can't arrange AVCs through the Department. Although you may be able to buy added years. Look for threads here and on a well known financial forum about whether AVCs or the purchase of service is the better way to go. Don't just rely on the Cornmarket sales consultant.

I couldn't agree more. Don't be foolish enough to rely on a Cornmarket salesman. My advice was the returns on their AVCs (via Irish Life) are far less than what you would get with an AVC with, for instance, Zurich. Also, the Irish Life/Cornmarket commissions are far higher. If you're with Cornmarket it's definitely time for you to look at independent comparative statistics on their returns and their commissions compared to the same with competitors. It's an eye-opening experience.

Seriously, we need a mega sticky financial/pensions thread here for teachers because there's loads of really good info but it's now scattered across the forum naturally enough. A huge number of teachers are absolutely clueless about their finances. Getting serious about them when they approach retirement is a bit spaced, to be charitable about it. Do it now in your 20s/30s/40s.

gaiscioch

Icsics wrote: »

Can I ask did you organise your AVCs through Cornmarket or Dept? Do they relate only to lump sum?

You can't organise your AVCs through the Department, unfortunately. The only one they facilitate as a deduction from salary is the ASTI/Cornmarket AVC, which is poor value. The ASTI really should be attaching themselves to a better value AVC.

When I stopped my Cornmarket one, I paid Zurich directly for a year in advance, uploaded their cert to Revenue's website, and Revenue spread my tax repayment out across the following year. It would be more convenient to have a salary deduction so very well done to Cornmarket for having a monopoly on that privileged position.

dingding

gaiscioch wrote: »

. It would be more convenient to have a salary deduction so very well done to Cornmarket for having a monopoly on that privileged position.

Also applies to the TUI. Surely the union should act in the best interests of their members. Not in every case, many of the financial products represent very poor value or are bundled with less necessary products to boost cornmarkets profits.

Icsics

Thanks everyone great advice

dingding

https://www.askaboutmoney.com/forums/public-sector-pensions.61/

Some great advice in the link above.

rainbowtrout

gaiscioch wrote: »

You can't organise your AVCs through the Department, unfortunately. The only one they facilitate as a deduction from salary is the ASTI/Cornmarket AVC, which is poor value. The ASTI really should be attaching themselves to a better value AVC.

When I stopped my Cornmarket one, I paid Zurich directly for a year in advance, uploaded their cert to Revenue's website, and Revenue spread my tax repayment out across the following year. It would be more convenient to have a salary deduction so very well done to Cornmarket for having a monopoly on that privileged position.

What have you done with your Cornmarket AVC?
Is it just frozen until retirement? Will there be any fees on it? Can you transfer any of it to another AVC?

Geuze

dingding wrote: »

Also applies to the TUI. Surely the union should act in the best interests of their members. Not in every case, many of the financial products represent very poor value or are bundled with less necessary products to boost cornmarkets profits.

You can buy a PRSA-AVC from other providers.

gaiscioch

rainbowtrout wrote: »

What have you done with your Cornmarket AVC?
Is it just frozen until retirement? Will there be any fees on it? Can you transfer any of it to another AVC?

Just took out the file there to find the precise details. The old Cornmarket AVC was transferred to Zurich as well. It now forms one of the two PRSA 'contract numbers' that constitute my 'fund'. I make no contributions to that AVC but the management charge per annum is 0.75% and there are no other 'contract charges'. It's in a Prisma (Risk Level 6) fund, the 'Unit Type' is 'Accumulator', and its value grew by just over 6% in the previous year. I'm not sure if I could transfer it to another PRSA/AVC, but the management charge was lower if I just left it 'frozen' there.

The Zurich AVC/PRSA fund that I do contribute to is also in a Prisma (Risk Level 6) investment fund and the 'Unit Type' is 'Accumulator'. It has a management charge of 1%, but as this is an active AVC there was also a 'contract charge' which works out at 3.5% of my annual contribution (although that might have been a once-off charge connected with moving as it didn't appear in a more recent mid-year statement). Lastly, the value of that PRSA contract had grown by 6.2% in the previous year.

It might be worth people's time to check their own management fees and returns to see how they compare.

A type of pension called a Personal Retirement Savings Account (PRSA) is one of the easiest ways to open your own pension if your boss does not offer one or if you are self- employed.

There are two types of PRSAs - a standard PRSA and a non-standard PRSA. The charges on a non-standard PRSA might be higher than on a standard PRSA.

With standard PRSAs, you cannot be charged more than a 1pc annual fund-management charge (a fee for the management of your pension fund), while the contribution charge (charged every time you make a contribution to your pension) cannot be higher than 5pc.

A contribution charge of 5pc is still high, however, so go through a low-cost broker if you are opening a standard PRSA. By doing so, you may avoid a contribution charge altogether, which means that your entire savings are invested into your pension from day one - rather than having a chunk of your contribution gobbled up by charges.(60-second guide to getting a PRSA)

This low-cost broker has positive reviews elsewhere on this website, and has a section on that link aimed at teachers who want to take out a PRSA/AVC. They don't give advice, though, but once you've got your advice you should save by purchasing through them (check if there is a 'contract charge' or 'contribution charge' on top of the 1%).

amacca

Sorry if this is a silly and very basic question

are there tax benefits to PRSA/AVCs ...like tax deductibility

does the govt match contributions or a percentage or anything


would a prsa be preferable to making your own investment decisions and investing index trackers/etfs/shares oneself....assuming you knew how of course

acequion

Hi guys, great thread.

I'd be a fairly interesting case as I was almost 40 before I was up and running with pensionable service. Which means I'll have to keep working into my 60's which is fast approaching, but though I hate the train wreck they've made of our profession, I like working and I like teaching so fingers crossed I'll be able for it in my 60's.

However, I'm also quite materialistic and don't fancy the idea of impoverished nether years so I've been doing my best to make provision and here's what I've done:

1. Buying 10 years notional service. Now I hugely pondered over that or AVCs and paid a lot for independent advice which hugely advocated the former. On my contract I have to keep paying it until 65 but am hoping to go at 63 or 64 and yes I know there's a penalty, but what I was told was that how the penalty works is that I'd be docked a few years, so would get 7-8 years back rather than 10 if I went a year or two earlier than contract. Sounds ok to me. I found the pension people in the Dept very helpful and answered all my questions as obviously I had many, requiring a lot of phone conversations with them.
   
2. A Zurich AVC. About 2 years ago I decided I should boost my retirement savings and again after much research decided an AVC was the way to go. I fully second the poster who said we need a sticky pensions thread here for teachers as I had to go all over Boards to get the info but I did get everything I needed here,including the advice not to AVC through Cornmarket, but by an independent broker like Zurich. Very sound advice. However it's a No Advice AVC and if like me you're in the Pass class on all matters financial, it can be very daunting and you will need advice. An accountant friend of mine put me in touch with a financial consultant who set up the whole thing for me completely free of charge as he would get the commission from Zurich. He gave me all the advice I needed and then I got in touch with revenue to organise the tax relief. That took a while to get sorted but once it did it was fine. However, if at any time I modify the amount I'll have to have the tax cert amended again, so it's less hassle to stick with the original amount.

Now people might wonder about all those years up to 40.Well, many of them were spent freelancing abroad so they're lost. However I was back teaching in Ireland by age 35, subbing etc and 2 years TWT, so will be able to get something for them.

Obviously I'm now paying a fortune into my pension but it is tax deductible and hopefully it will be worth it. Definitely people need to make provision in advance,however even with only a few years left it's worth getting an AVC. Much better than regular savings because of the tax incentive. The older you are the more you're allowed save towards a pension, so it's the logical thing to do with any spare cash.

Sorry for the long post,folks. Like I say I'm in the Pass class on these things, so not able to be more succinct. Happy saving OP.:)

Geuze

amacca wrote: »

Sorry if this is a silly and very basic question

are there tax benefits to PRSA/AVCs ...like tax deductibility

does the govt match contributions or a percentage or anything


would a prsa be preferable to making your own investment decisions and investing index trackers/etfs/shares oneself....assuming you knew how of course

All pension conts attract tax relief.

PRSA/AVCs are personal pensions, so no employer cont.

You can think of the tax relief as the Govt cont.

Geuze

acequion wrote: »

Hi guys, great thread.

However, I'm also quite materialistic and don't fancy the idea of impoverished nether years so I've been doing my best to make provision and here's what I've done:

1. Buying 10 years notional service. Now I hugely pondered over that or AVCs and paid a lot for independent advice which hugely advocated the former. On my contract I have to keep paying it until 65 but am hoping to go at 63 or 64 and yes I know there's a penalty, but what I was told was that how the penalty works is that I'd be docked a few years, so would get 7-8 years back rather than 10 if I went a year or two earlier than contract. Sounds ok to me. I found the pension people in the Dept very helpful and answered all my questions as obviously I had many, requiring a lot of phone conversations with them.
   
2. A Zurich AVC. About 2 years ago I decided I should boost my retirement savings and again after much research decided an AVC was the way to go. I fully second the poster who said we need a sticky pensions thread here for teachers as I had to go all over Boards to get the info but I did get everything I needed here,including the advice not to AVC through Cornmarket, but by an independent broker like Zurich. Very sound advice. However it's a No Advice AVC and if like me you're in the Pass class on all matters financial, it can be very daunting and you will need advice. An accountant friend of mine put me in touch with a financial consultant who set up the whole thing for me completely free of charge as he would get the commission from Zurich. He gave me all the advice I needed and then I got in touch with revenue to organise the tax relief. That took a while to get sorted but once it did it was fine. However, if at any time I modify the amount I'll have to have the tax cert amended again, so it's less hassle to stick with the original amount.

Now people might wonder about all those years up to 40.Well, many of them were spent freelancing abroad so they're lost. However I was back teaching in Ireland by age 35, subbing etc and 2 years TWT, so will be able to get something for them.

Obviously I'm now paying a fortune into my pension but it is tax deductible and hopefully it will be worth it. Definitely people need to make provision in advance,however even with only a few years left it's worth getting an AVC. Much better than regular savings because of the tax incentive. The older you are the more you're allowed save towards a pension, so it's the logical thing to do with any spare cash.

Sorry for the long post,folks. Like I say I'm in the Pass class on these things, so not able to be more succinct. Happy saving OP.:)

Zurich are an insurer/pension company, not an "independent broker".

Nothing is "free of charge" - the financial consultant may be charging you as much as Cornmarket would.

The commission comes out of your fund, your money.

Did you check that?

acequion

Geuze wrote: »

Zurich are an insurer/pension company, not an "independent broker".

Nothing is "free of charge" - the financial consultant may be charging you as much as Cornmarket would.

The commission comes out of your fund, your money.

Did you check that?

Yes of course I did. While I can't remember off the top of my head how he is paid, I remember being fully satisfied with everything when it was set up and getting it all in writing. This person was recommended by a good friend of mine. It definitely is a much better deal than I'd get with Cornmarket.

And yes I know what Zurich are,do forgive my fluffing the terminology! But thank you for your concern.

Geuze

For information, here are the Cornmarket AVC fees for the TUI scheme:

https://www.cornmarket.ie/uploads/12748_Update_AVC_charge_statements_11-17_rebranded_TUI.pdf


525 set-up fee
2% ongoing charge on each regular contribution

Both of these are avoided if you use an execution-only service.

AMC = 1.00%

I note that the AMC falls to 0.75% and 0.50% as the fund size increases.


Say you save 500 pm for ten years, so 60k contributed.

You will pay 1,200 + 525 = 1,725 in fees for advice.

I would argue this is bad value.

Geuze

https://cornmarket.cdn.prismic.io/cornmarket%2F9664aa53-335c-47e3-b5af-deca11cb6534_14010+avc+charges+statement+-+irish+life+multi_11-18_form.pdf

More info on Cornmarket fees above.

Applicable for members of the following Irish Life AVC Schemes:
AHCPS, ASTI, DCU, Fórsa (Civil Service), INTO, Local Authority & State Agency,
Nurses and Other Health Professionals, SOLAS, TUI.

This seems to be a more recent document than the one in my previous post.

Scheme Charges:
Consultancy Fee
(deducted monthly from contributions in year one): €595
Contribution Charge
(as a % of each regular contribution): 0%
Contribution Charge
(as a % of each single premium contribution): 4%

Seems to be better value as the 2% contribution charge is gone?

realdanbreen

I think when they make it illegal(it's already immoral) to have teachers giving grinds to their pupils in a hotel lobby two hours after they were 'teaching' them in the classroom might be the time to cash out.

trihead

Information on Notional Service Scheme

https://www.education.ie/en/Education-Staff/Services/Retirement-Pensions/Teaching-Staff/Notional-Service-Scheme

dingding

https://www.education.ie/en/Education-Staff/Services/Retirement-Pensions/supplementary-pension-explanatory-note.pdf

Supplementary Pension Explanatory Note.