How's your pension?

Winning_Stroke

Lot of talk about government pension timebombs down the road but I'm curious as to how you all are privately handling it. Are your pension contributions healthy? Are you happy with it or diverting resources to other goal like house deposit and family?

Not really looking for a d!ck measuring contest.

I think I'm in a pretty good position, I have a decent employer matched one and have a private one too. But we don't have kids yet... so we'll see.

I've a self directed executive pension. I throw a nice bit into it, I used to overpay my mortgage quite a bit but I'm on a lower fixed rate now so am directing more into the pension.

I'm aiming to knock about €30k/annum out of it after I take the lump sum upon retirement. I'll be going the ARF route rather then the annuity option. Annuities are daylight robbery IMO.

Pyr0

I've literally just finished the paperwork for starting my pension, i'll report back in a few years.

Trigger Happy

I joined a DB pension last year and have a long standing DC fund too am fairly hopeful that I will be well able to look after myself when the time comes. Hope to retire at 60 though.

Salary Negotiator

Paying into one but probably not paying enough, I'll be ramping up my contributions later in the year to start making up any shortfall.

buried

Got mine invested in ZurichBurpDOTie. Been calculating all my pay days down until I retire. Plenty of San Pelle and Grey Goose for the future will be absolutely sending it when the time comes. Total high sustainability factor and what with the property portfolios reaching an all time high skybase now and into the future. Its going to be epic. Get down to your broker now.

Dravokivich

Don't have one. Had to explain to a mate's wife a year or so ago, that my kid would rather eat food and wear clothes now, than in 30 years time.

buried

buried wrote: »

... will be absolutely sending it when the time comes. ............. Its going to be epic..............

Winning_Stroke

buried wrote: »

Got mine invested in ZurichBurpDOTie. Been calculating all my pay days down until I retire. Plenty of San Pelle and Grey Goose for the future will be absolutely sending it when the time comes. Total high sustainability factor and what with the property portfolios reaching an all time high skybase now and into the future. Its going to be epic. Get down to your broker now.

I'm totally invested in Hobbscoin.

Apiarist

Salary Negotiator wrote: »

Paying into one but probably not paying enough....

Same here. I'll be ok with the mortgage paid off before that, but won't have much spare cash unless I start contributing a lot more starting soon.

Cee-Jay-Cee

State pension. 8 years to retirement. Have no idea what will happen between now and then.

I also have two ‘with profit’ savings plans that I started in 2000, they’re 30’year plans and have performed brilliantly since day one with over 25% gain every year to date. There should be a nice little bonus at the end which should be more than enough to put both my daughters through college.

jimgoose

Not too bad I'd reckon, I have a 7%/5% employer-contributed pension that's currently worth around 400k, and should be good for two-thirds or so of salary when I retire, which will probably be at age 70. That and whatever is left of the State pension should be enough to keep me in cakes and ale until my Earthly clogs pop. The mortgage will be paid off long before that, as well.

buried

Winning_Stroke wrote: »

I'm totally invested in Hobbscoin.

Hobbscoin!? Nice....Nice John..... You got in well there buddy. I hear the final take return on an investment like that is on par with the 70,000 a year that good old Yatezer himself is curveburglin into his net pipe portfolio shaft.

BeerWolf

Pension?

Winning_Stroke

BeerWolf wrote: »

Pension?

Yes, you're going to be auto-enrolled in one.

Johnny Sausage

was late enough joining one but better late than never,

i do the employer match of 5% and then 5% AVCs on top

NIMAN

Been paying into a private, work related one for 20yrs now.

Employer only contributes 5%, for many years I was 5% too.

Couple of years back went to 8% and now recently at 12%.

Hopefully it'll be there when I retire! Or the kids head off to college.

dmm82

What do people reckon a decent amount to be paying in each month is? I've been paying in for around 5 years now (started aged 32) and my employer matches what I pay but I'm probably not putting enough in. Pensions confuse the life out of me!

thomasm

Cee-Jay-Cee wrote: »

State pension. 8 years to retirement. Have no idea what will happen between now and then.

I also have two ‘with profit’ savings plans that I started in 2000, they’re 30’year plans and have performed brilliantly since day one with over 25% gain every year to date. There should be a nice little bonus at the end which should be more than enough to put both my daughters through college.

Whats the name of the fund and provider. That sounds incredible

lawred2

I'm putting in 10% and employer 5%

Not enough though - need to up it

Bobblehats

It’s not something I’d like to dwell on

Winning_Stroke

dmm82 wrote: »

What do people reckon a decent amount to be paying in each month is?

Extremely rough rule of thumb says, that you should contribute half your age (when you start it) as a percentage of your pay.

So you start at 30 year old and keep putting in 15%.

As said, not scientific.

Other rule of thumb: put in as much as you can afford

Cee-Jay-Cee

thomasm wrote: »

Whats the name of the fund and provider. That sounds incredible

Concordia. It was originally through Canada Life but through Irish Life now. It closed in 2001, I think. I’m only putting a small amount in each month (less than €100) but it’s performing very very well and has done since inception.

Bogwoppit

Have one in the UK for the last 11 years, DC, I contribute 5% employer 15.
Stopped paying into that one this year and started one here with the same payments.

I’m 38 now so I guess I’m doing middle of the road ok.

Would like to pay more but can’t afford it right now.

Nijmegen

Anyone who has an employer putting money in on a match basis who doesn't maximise it is basically throwing away the most tax efficient cash they will likely ever work with - No tax on the way in and highly favourable tax treatment on the way out.

If you have a high disposable income you should really consider maximising your contributions generally, given that the money you put into your pension is gross rather than net of tax.

talking_walnut

Anybody able to offer advice on setting one up? Never had an employer that offered one but was just thinking I need to get moving on it myself.

Geuze

I have a final-salary DB pension.

I contribute 16.5%.

If I have full service (unlikely), I'll get half my final salary.

That includes the State Pension in the half.

dmm82

dmm82 wrote: »

...........(started aged 32) and my employer matches what I pay but I'm probably not putting enough in. Pensions confuse the life out of me!

Starting at 32 I'd use the max allowed as a guide until you are 50.
Once you get to that an assessment of what you have versus what you need might suggest not lashing loads more in as you can put way more in as you go over 50 etc.

talking_walnut

talking_walnut wrote: »

Anybody able to offer advice on setting one up? Never had an employer that offered one but was just thinking I need to get moving on it myself.

https://www.labrokers.ie/prsa-pensions/zurichprsa/

Low cost "The only charge is the 1%* pa management charge." and the investments are sensible/responsible so you should end up with a diversified portfolio that's passively managed.... "A “Default Investment Strategy” that targets growth in the early years but changes to a lower risk portfolio as retirement approaches"

I don't have one myself but something like that offering is ideal for the vast majority of folk, I'd likely be better off with it myself but I like playing around with a % of my pension

Nijmegen

talking_walnut wrote: »

Anybody able to offer advice on setting one up? Never had an employer that offered one but was just thinking I need to get moving on it myself.

Firstly, lots of great advice (from people who will offer it honestly but are brokers etc) in places like Ask About Money forum elsewhere on this wide internet.

Your employer is obligated by law to offer you the facility to contribute to a PRSA via payroll, and may have a scheme set up (which you're not obligated to join).

The key thing to look out for in a pension scheme is the fees, of which there are two primary types you can see:

1. Allocation fee - The fund takes a cut of the money you put in as you put it in
2. Annual fee - A % of the total value of the fund each year

Getting this right is really critical. Allocation fees can range from 5% if you rock up and buy something on the street to 1% and even 0% if you get a good deal usually via a broker.

The annual fee is another one to look to get down as much as possible, again via a broker.

After that you decide what type of investment strategy you want, from risky (think, stock market) to non-risky (like government bonds). Typically you'd go risky when you're young and move progressively towards non-risky when you're closing in on retirement. Reason for this is that over the long term risky bets like shares increase in value - even if you had a pension fund invested in shares in 2008-2009 and they tanked, they have well increased in value since then (like, massively.) But if you were looking to retire in 2008-2009 you'd have wanted your money in safer bets. (Also, you're gonna become much less of a fan of things like "burning the bondholders" when you realise age 60 that you're the bondholder.)

You can control most of that stuff from online portals with pension providers nowadays.

The beauty of a pension is that the money you put in is tax free, ie comes off your gross salary, with the % you can put in tax free limited by your age bracket (it goes up as high as 40% in your 60s or can be 15% in your 30s for example). Then when you're taking the money out when you retire, a lot of it will come out tax free or at your marginal rate, so for example you can take a €200k tax free lump sum on retirement and then give yourself a pension that's only being taxed at the lower rate of 20% each year even if today you're earning in the top rate and are shoveling in money the government would otherwise be taking 40% of today.

Pensions are the most heavily subsidised tax activity in the country besides certain corporation tax arrangements.

talking_walnut

Augeo wrote: »

https://www.labrokers.ie/prsa-pensions/zurichprsa/

Low cost "The only charge is the 1%* pa management charge." and the investments are sensible/responsible so you should end up with a diversified portfolio that's passively managed.... "A “Default Investment Strategy” that targets growth in the early years but changes to a lower risk portfolio as retirement approaches"

I don't have one myself but something like that offering is ideal for the vast majority of folk, I'd likely be better off with it myself but I like playing around with a % of my pension

Thought that URL said Ladbrooks for a second

Forgot that I had started an Irish Life pension a few years ago but had to put it on hold when changing jobs. Is there anything to look at or watch out for if when deciding between restarting it vs. moving to something like this?

cefh17

Nijmegen wrote: »

Anyone who has an employer putting money in on a match basis who doesn't maximise it is basically throwing away the most tax efficient cash they will likely ever work with - No tax on the way in and highly favourable tax treatment on the way out.

If you have a high disposable income you should really consider maximising your contributions generally, given that the money you put into your pension is gross rather than net of tax.

Agreed, have nudged a few colleages to increase their 1% (mandatory) to 4% personal contribution making their total contribution go from 3% including the employer match to 12% overall. Have been putting in 15% (+8% match) since the month I started. Don't know any different, I can imagine it stinging a bit if you started it down the line and got used to the extra dispoable cash

talking_walnut

talking_walnut wrote: »

...........
Forgot that I had started an Irish Life pension a few years ago but had to put it on hold when changing jobs. Is there anything to look at or watch out for if when deciding between restarting it vs. moving to something like this?

What this poster mentions.........

Nijmegen wrote: »

............

The key thing to look out for in a pension scheme is the fees, of which there are two primary types you can see:

1. Allocation fee - The fund takes a cut of the money you put in as you put it in
2. Annual fee - A % of the total value of the fund each year

Getting this right is really critical. Allocation fees can range from 5% if you rock up and buy something on the street to 1% and even 0% if you get a good deal usually via a broker..............

Not great, I've only paid into a pension for 4 years and I'm mid 30's. Haven't been paying any for over a year now either as I moved jobs and there is no pension scheme and haven't got around to setting up a private one yet. Also with saving for a house build I'm sort of happier to have the higher take home pay now rather than it going into a pension at the moment.

ednwireland

pretty much non existant some bits and pieces around, so lottery tickets it is !

talking_walnut

Augeo wrote: »

What this poster mentions.........

Can't find any mention of either of those in the documents but there is a "Contribution Fee" which is probably equivalent and looks to be at 5%.
Thanks for the help guys. Half the reason I have been putting off getting it going again is that I had a feeling it was shafting me somehow.

talking_walnut

talking_walnut wrote: »

Can't find any mention of either of those in the documents but there is a "Contribution Fee" which is probably equivalent and looks to be at 5%.
Thanks for the help guys. Half the reason I have been putting off getting it going again is that I had a feeling it was shafting me somehow.

You .......... 95% allocated is a 5% contribution fee. Shouldn't be allowed IMO but such is life.

Ronan|Raven

Pen.. sion?!

Amirani

Employer matches up to 7%. I put in the max 15% allowed for my age. So there's a total of 22% of salary going in each month, which is fairly good I think.

NIMAN

I think many of us who are putting decent money into a pension are secretly worried that somehow the Gov will find a way to steal too much of it from us in later life, to help pay for all those who couldn't be bothered with a private pension.

delboythedub

Amirani wrote: »

Employer matches up to 7%. I put in the max 15% allowed for my age. So there's a total of 22% of salary going in each month, which is fairly good I think.

Well done and you should go on line and check how your pension is doing regularly. Mine dropped €10.000 in one year and then i learned to keep a very close check on it. It always nice to know that you will have a few quid in your pocket when you retire and have time to enjoy it. I retired 2 years ago.

Salary Negotiator

victor8600 wrote: »

Same here. I'll be ok with the mortgage paid off before that, but won't have much spare cash unless I start contributing a lot more starting soon.

I’m getting married this year so I’m only paying the minimum to get the max employer contributions. Once the wedding is done and paid for in August I’ll increase my contributions to 20% until I’ve to (hopefully) pay for childcare.

have 13/40 years done in the public service, wont starve anyway.

lawred2

delboythedub wrote: »

Well done and you should go on line and check how your pension is doing regularly. Mine dropped €10.000 in one year and then i learned to keep a very close check on it. It always nice to know that you will have a few quid in your pocket when you retire and have time to enjoy it. I retired 2 years ago.

pensions will always fluctuate and it's pretty much a waste of time, money and emotion chopping and changing based on yearly results...

We will be grand I have a good pension, with the way modern society has normalised having children in your 40s someone could easily be in the position of still supporting children who are in college while trying to live off a pension and paying a mortgage.

NIMAN

NIMAN wrote: »

I think many of us who are putting decent money into a pension are secretly worried that somehow the Gov will find a way to steal too much of it from us in later life, to help pay for all those who couldn't be bothered with a private pension.

I would not be worried about taking it from those with a pension to pay for those without, but I do wonder about it being levied or taxed in some way

mariaalice

mariaalice wrote: »

...........but I do wonder about it being levied or taxed in some way

That's what the poster is worried about.

Trigger Happy

mariaalice wrote: »

I would not be worried about taking if from those with a pension to pay for those without, but I do wonder about it being levied or taxed in some way

Its a conundrum all right.
The govt wants more/all private sector employees to put on their big boy trousers and look after their own pensions.
But many dont and wont as they assume the government will always look after them with pensions at the same relative levels as today.
And the current and future governments needs to maintain existing state and public sector pension levels because touching the pensions is a vote killer and old people vote in their masses. Its policitcal suicide to cut pensions or not give them the expected €5 per year.
With less and less working people per pensioner this is the timebomb. There is tough medicine to come and the only question is who is going to be taking it.

Fccwontletmebe

Amirani wrote: »

Employer matches up to 7%. I put in the max 15% allowed for my age. So there's a total of 22% of salary going in each month, which is fairly good I think.

Just have a few questions if someone can answer.
1) when can you take a limp sum out of the pension?
2) At what age can you start drawing down on the pension and properly retire with it?

I’m current saving a little over 2 grand a month and not paying into my works pension which matches 8%.

I really don’t want my money caught up in something out of my control until I’m 65.

I’m 31 and have savings of nearly of 100K and no mortgage.

I just don’t think it’s right for me even with the tax breaks. I plan on retiring at 55 at the latest. But more than likely 50 and pick a few contract roles every so often.

c.p.w.g.w

Augeo wrote: »

Starting at 32 I'd use the max allowed as a guide until you are 50.
Once you get to that an assessment of what you have versus what you need might suggest not lashing loads more in as you can put way more in as you go over 50 etc.

How do you calculate the max allowed?

NIMAN

Trigger Happy wrote: »

With less and less working people per pensioner this is the timebomb. There is tough medicine to come and the only question is who is going to be taking it.

We all know the answer to that.

It'll be the middle ground taxpayers. No different to today.

And in the future, the people around 40 or 50 now who are saving into pensions, will likely have them raided to pay for those who rely on others to look after them.