Private vs Public

jinish

Hi All
Just trying to get some perspective.

I am currently a public sector (HSE) employee, on 60k. Just casually exploring the job market outside and I have been offered a job in private 70K plus 13% bonus, with health insurance for the family.

It's the same role. I see greater career progression staying in HSE, even though it might take a few years. I feel that once I am out to private, it kinda hard to get back in HSE (It's only a feeling).

Fire away, what would you do?

AndrewJRenko

How old are you? Do you have family commitments now or in the future?

Larbre34

Go calculate the personal contribution required to match your HSE pension, were you to join the private sector.

Then make yourself a big mug of hot sweet tea to get over the shock and get back to your HSE job for the rest of the day and try not to look too embarrassed that you even considered it.

You're welcome.

jinish

AndrewJRenko wrote: »

How old are you? Do you have family commitments now or in the future?

35. Wife and two kids (elder 5 years, younger 8 months). The wife does some odd nursing shifts during weekends.

New house recent mortgage, for next 34 years ~1350 mortgage alone.

No major commitments, except the normal, chors including bills/insurance/etc

maxsmum

Think about things like overtime, will you be expected to stay late, answer emails out of hours etc in the private sector
I was offered a higher salary once, but I would have been working crazy hours and the sacrifice and impact on family life wasn't worth it in the end.

jinish

Larbre34 wrote: »

Go calculate the personal contribution required to match your HSE pension, were you to join the private sector.

Then make yourself a big mug of hot sweet tea to get over the shock and get back to your HSE job for the rest of the day and try not to look too embarrassed that you even considered it.

You're welcome.

I did it. To match my pension, I should be contributing around 1000 per month:eek:

jinish

maxsmum wrote: »

Think about things like overtime, will you be expected to stay late, answer emails out of hours etc in the private sector
I was offered a higher salary once, but I would have been working crazy hours and the sacrifice and impact on family life wasn't worth it in the end.

Thank you!

jinish

jinish wrote: »

I did it. To match my pension, I should be contributing around 1000 per month:eek:

That's the end of that so!

6541

Do not leave the Public sector. Currently I am rubbing cream into the wounds of the daily whipping I get in the private sector !

jinish

6541 wrote: »

Do not leave the Public sector. Currently I am rubbing cream into the wounds of the daily whipping I get in the private sector !

Than you, I haven't even accepted it.

It's funny, they contact you and state salary is 80k, Then the say its 70 + 13% performance bonus. And then there is the whole other realm of private sector work pressure.

maxsmum

The value attached to time before 9am and after 5pm being totally protected is just priceless
If you can live happily on current salary then stay where you are

dvdman1

Public sector all the way..the extra 10k after tax won't even be worth the hassle and security

RoboRat

jinish wrote: »

Than you, I haven't even accepted it.

It's funny, they contact you and state salary is 80k, Then the say its 70 + 13% performance bonus. And then there is the whole other realm of private sector work pressure.

That 13% bonus is really about 7% as it will be taxed to hell and back.

Also, as previously stated, in the private sector, you are considered a salaried worker unless otherwise stated. This means that irrespective of the amount of extra work you do, you get the same wage.

Plus there are plenty of private sector companies that offer no sick pay and a holiday allowance of 20 days per year. Depending on the company, an annual pay review isn't a given, plus if things go sideways you have to worry about being laid off, made redundant or having to take a pay cut.

Hooked

maxsmum wrote: »

The value attached to time before 9am and after 5pm being totally protected is just priceless
If you can live happily on current salary then stay where you are

Just stumbled across this thread on the home page...


The extra money... is just that... money.


As someone who earns a very modest wage... I wouldn't swap my choice to be near family & friends, in a 9-5, Mon-Fri, relatively stress free role for all the tea in China as they say.

I have friends earning 100k+ that I never see - and when I do... they rant about work pressures, marriage issues and the rest.

I have a good friend who is in his late 40's, and stacks shelves in a cash n carry. Has done his whole life. He's probably the happiest person I know. Zero stress.

You're on a good thing as you are. A bird in the hand, and all that!

Yurt2

Hooked wrote: »

Just stumbled across this thread on the home page...


The extra money... is just that... money.


As someone who earns a very modest wage... I wouldn't swap my choice to be near family & friends, in a 9-5, Mon-Fri, relatively stress free role for all the tea in China as they say.

I have friends earning 100k+ that I never see - and when I do... they rant about work pressures, marriage issues and the rest.

I have a good friend who is in his late 40's, and stacks shelves in a cash n carry. Has done his whole life. He's probably the happiest person I know. Zero stress.

You're on a good thing as you are. A bird in the hand, and all that!

I once had a conversation over a pint with a twice divorced doctor. He compared himself to his brother who worked in a postal sorting office all his life. He used to look down on him for his lack of ambition, but now realises his brother was doing life right all along.


Mind you, he started in Royal Mail when one could expect a decent pension at the end of it.

blindsider

Larbre34 wrote: »

Go calculate the personal contribution required to match your HSE pension, were you to join the private sector.

Then make yourself a big mug of hot sweet tea to get over the shock and get back to your HSE job for the rest of the day and try not to look too embarrassed that you even considered it.

You're welcome.

THIS^^^

End of thread.

Green Mile

This is an interesting read.

I seen a job opening up in the HSE for what I do and it got me excited. I’m in the private sector on a decent ok salary and an ok pension.

The job just says Grade VII salary. When I google it, it gives several salaries, I’m guessing I’ll be on the first point as I’ve never worked in public before?

Am I right that the employer pension is about 25%.

The thing is, I’m happy in the current job, so I don’t want to rock the boat. Who knows what I’d be getting myself into.

Green Mile

Green Mile wrote: »

This is an interesting read.

I seen a job opening up in the HSE for what I do and it got me excited. I’m in the private sector on a decent ok salary and an ok pension.

The job just says Grade VII salary. When I google it, it gives several salaries, I’m guessing I’ll be on the first point as I’ve never worked in public before?

Am I right that the employer pension is about 25%.

The thing is, I’m happy in the current job, so I don’t want to rock the boat. Who knows what I’d be getting myself into.

The pension post 2014 is a different beast

The pension from 1995-2013 is a middling beast

The pension pre 1995 is the one most people think they are referencing

A lot of private sector firms match contributions up to 11, 12% and with tax benefits its not the difference that the propaganda machines would have you believe

The hours, the stress, the training, all fair enough

The salaries, for experienced and qualified professionals, a good bit less

Weight it up, its a different answer for everyone- best of luck

AndrewJRenko

[Deleted User] wrote: »

The pension post 2014 is a different beast

The pension from 1995-2013 is a middling beast

The pension pre 1995 is the one most people think they are referencing

A lot of private sector firms match contributions up to 11, 12% and with tax benefits its not the difference that the propaganda machines would have you believe

Good point. OP might want to clarify which pension he qualifies for currently.

cunnifferous

Deleted User wrote: »

The pension post 2014 is a different beast

The pension from 1995-2013 is a middling beast

The pension pre 1995 is the one most people think they are referencing

A lot of private sector firms match contributions up to 11, 12% and with tax benefits its not the difference that the propaganda machines would have you believe

The hours, the stress, the training, all fair enough

The salaries, for experienced and qualified professionals, a good bit less

Weight it up, its a different answer for everyone- best of luck

This is 100% correct. I'm on similar wage in the HSE on a post 2013 contract and the pension is well....not great. When you take out the state contributory element that every PRSI paying worker is entitled to, it really is minimal. So much so that I need to take out a separate PRSA if I want to retire before 67.

C.O.Y.B.I.B

Green Mile wrote: »

This is an interesting read.

I seen a job opening up in the HSE for what I do and it got me excited. I’m in the private sector on a decent ok salary and an ok pension.

The job just says Grade VII salary. When I google it, it gives several salaries, I’m guessing I’ll be on the first point as I’ve never worked in public before?

Am I right that the employer pension is about 25%.

The thing is, I’m happy in the current job, so I don’t want to rock the boat. Who knows what I’d be getting myself into.

Just on this , yes , you will likely start on point 1 which will increase every year.
GrVII is the highest mid-mgt grade where you still get flexi-time and still get to work "9-5" . Once you get promoted from there you lose flexi and there would be quite a few at GrVIII and up who would work a few hours evenings and weekends and may have more "stressful" jobs. Just something to bear in mind .
On the plus side depending on where you work if you are hardworking and ambitious you will standout and have opportunities to progress.
Hope that helps

beauf

Never understood why higher grades lose flexi. Considering you'll have to work out of hours anyway.

Thomasirl123

jinish wrote: »

I did it. To match my pension, I should be contributing around 1000 per month:eek:

Would you mind sharing your calculations? I've applied for a public sector job but means a salary reduction.

I went from a decent paying job with great perks and career prospects to a clerical officer role in civil service. Took a fairly big pay cut but at the time I could afford to do it. I’m happy I took the job in the public sector. I had a terrible first year in the civil service but that has sorted itself out and I am delighted to have made the change.

I say stay!

Mrs OBumble

maxsmum wrote: »

The value attached to time before 9am and after 5pm being totally protected is just priceless
If you can live happily on current salary then stay where you are

You realise that for clerical/admin grades, the standard HSE contract now says you can be asked to work anytime from 8am-8pm, over 7 days.

It's still only 37 hours per week, but not always 9-5 at all.

beauf

There is likely to be a promotion, recruitment freeze after Covid. Rapid promotion might be hard to get. Even a wage reduction.

Chaos Black

Not HSE, but Civil Service and I like most around me am doing far more then the 37.5hrs a week for the past year since COVID-19.

9-5 job may exist in some public sector jobs, don't know if guaranteed anymore or in the future.

AndrewJRenko

beauf wrote: »

There is likely to be a promotion, recruitment freeze after Covid. Rapid promotion might be hard to get. Even a wage reduction.

That's a good point - OP should consider where they will have the best promotion or mobility opportunities, assuming that is of interest to them.

Larbre34

Larbre34 wrote: »

Go calculate the personal contribution required to match your HSE pension, were you to join the private sector.

Then make yourself a big mug of hot sweet tea to get over the shock and get back to your HSE job for the rest of the day and try not to look too embarrassed that you even considered it.

You're welcome.

Depends what age he is and whether he wants to work till 68 or 70 to get the full PS pension.

Moved from private sector to public a few years ago.
Took a substantial cut in pay and haven't looked back.

I no longer do 70 hour weeks and have my phone ringing 24/7

whampiri

I've done Private, public and self employed at various stages of my life.

Private is great when the economy is good. Bonuses, parties, "merit" based promotions etc but no job security.

Public is great for security but wages can be poor, promotion is based on competition and there's no such thing as a bonus.

I only did self employed for a bit and not long enough to be able to evaluate it properly (Less than a year), but its always on, but you can decide on your own jobs.

Having done them all, I'll be sticking with the Public service. Has its drawbacks, constant criticism from people but overall I prefer security over the possibility of earning a high wage.

jinish

AndrewJRenko wrote: »

Good point. OP might want to clarify which pension he qualifies for currently.

I am on single pension scheme (post 2013)

AndrewJRenko

jinish wrote: »

I am on single pension scheme (post 2013)

Are you sure that the pension comparison you did earlier was based on the Single Pension Scheme? It's really not a great scheme.

jinish

AndrewJRenko wrote: »

Are you sure that the pension comparison you did earlier was based on the Single Pension Scheme? It's really not a great scheme.

I didnt do deep maths, just a broad calculation.
I started at HSE during 2013. If I continue to work for HSE until I am 68, ( with an average salary of 60k), I would be getting around 75k lumpsum and 26k Annual pension( Including the 12k state pension).
To match these figure, I should be paying around between 900-1000 (Less tax benefit around 600) per month.
Again these all are just broad numbers that I remember.
Currently the pension contributions are around 300 per month.

AndrewJRenko

jinish wrote: »

I didnt do deep maths, just a broad calculation.
I started at HSE during 2013. If I continue to work for HSE until I am 68, ( with an average salary of 60k), I would be getting around 75k lumpsum and 26k Annual pension( Including the 12k state pension).
To match these figure, I should be paying around between 900-1000 (Less tax benefit around 600) per month.
Again these all are just broad numbers that I remember.
Currently the pension contributions are around 300 per month.

How many years service will you have at retirement?

So you would be paying that 900 or 1000 a month nett or gross?

Id say that 600 tax is a relevant enough figure to be clear about

Edit: you arent presuming your private employers might match contributions also?

Edit 2: take the 12k COAP from the 26k also. Its yr prsi pays for that

So if im reading right your private sector pension needs to match a 75k lump sum and a pension of 14k, and you may get employer contributions towards that

I don't think yr comparisons on the pension costs/benefits are at all accurate tbh and id look again to be sure of my understanding if i were you

Padraig1888

Works out an extra €5k after tax, although the bonus added, but I'd stay with the HSE for job security and pension.

Deleted User

Deleted User wrote: »

A lot of private sector firms match contributions up to 11, 12% and with tax benefits its not the difference that the propaganda machines would have you believe

And what the propaganda machine of the public sector don't tell you is that their pension contributions do not apply to the total of their salary, only the amount above a threshold, €35000 for the ASC contribution.

Employees having matching 11% contributions in the private sector have that amount applied to their whole salary.

The "10-16% contribution" spin we hear from public sector is not their actual % contribution of their salary.

PS pensions also are guaranteed, linked to increases in current employee salaries and with spouse entitled to half in the case of death.. Now recalculate what the private workers' contribution needs to be to have these benefits as well.

namenotavailablE

My Excel spreadsheet might be useful for doing net pay calculations:

http://taxcalc.eu/monthlyss/Employee%20PAYE%20calculator.xlsm

Uses macros so for Windows only and minimum version of Excel is 2010

JPup

Is the potential private sector employer not offering a pension match? It's common that if you put in 5% of your gross salary a month (3% net approx) that the employer will top that up by 10% of your gross pay. Worth checking and redoing the sums.

Before you turn them down, it's also worth asking if they will give you the €80k pay before bonus which is what you thought was being offered. If they give you a €80k salary, plus 10% pension match, plus health insurance, plus bonus potential then you might be on to a winner.

bilbot79

60k in public is a nice place to be.

salonfire

salonfire wrote: »

And what the propaganda machine of the public sector don't tell you is that their pension contributions do not apply to the total of their salary, only the amount above a threshold, €35000 for the ASC contribution.

Employees having matching 11% contributions in the private sector have that amount applied to their whole salary.

The "10-16% contribution" spin we hear from public sector is not their actual % contribution of their salary.

PS pensions also are guaranteed, linked to increases in current employee salaries and with spouse entitled to half in the case of death.. Now recalculate what the private workers' contribution needs to be to have these benefits as well.

Correct to a large extent- but i was keeping it relevant to questioning the poster's understanding of their own figures to be sure to be giving them good advice.

Seeing as we dont know about the scheme they are on i cant likewise be certain of either the contributions made nor the exact benefits.

But if you're asking me is my pension great, yeah its ****ing brilliant, thanks!

Edit: for my own interest and because its good to know i spose:

Leaving out PRSI and the 12k COAP so:

Pension contributions total roughly 8.5/9% of my salary.

Seeing as that 12k paid for through PRSI (amongst other things, ofc) on current figures comprises almost a half of my final annual pension, then id have said that whatever type of angle you took at it youd be fair in allowing a couple of percent *at least* in trying to account for it.

No propaganda there, im sure youd accept? So yeah, on my scheme, with my benefits, id think well over 10% of salary safely goes to pension.

OP and anyone else in the situation just needs to know what they currently pay and get, and what the private offer encapsulates, but for anyone post 2013 as stated a decent matching offer from an employer is imo not something that you should just handwave away.

jinish

Thank you all for the valuable contributions.
Its very helpful.
Il

floorpie

Can someone sum up the private vs public pensions (post 2013) topic, for someone trying to understand pensions for the first time.

It seems that public sector employees pay pension contributions + PRSI, but don't receive the state pension, whereas a private employee who paid both would receive state pension + private pension. If the amount an average employee pays into pension + PRSI is equal throughout their career, is the private employee getting more in retirement, generally?

Do public pensions fluctuate with markets in the same way pension funds seem to?

I've seen posters say "I'm going to retire when my pension pot reaches x", do public employees have this same mechanism for making use of their pension?

Posters also say that public sector pensions are more safe than private. Safe in what sense? I'm looking at a report about expected future costs of public pensions (https://assets.gov.ie/7297/b20cd73e5e714136be88bd828aea7667.pdf) and it says they're unsustainable and lists permissible ways to cope with this, e.g. linking pension increases to CPI rather than pay parity. This seems to expose employees to the same economic risks that private employees are exposed to, except public pension can't be touched until retirement? That doesn't seem very safe

maxsmum

Public sector employees get state pension too.

floorpie

maxsmum wrote: »

Public sector employees get state pension too.

So the state pension and occupational (?) pension are integrated for public sector employees? Is this to their benefit or detriment, or makes no difference?

The_Conductor

floorpie wrote: »

So the state pension and occupational (?) pension are integrated for public sector employees? Is this to their benefit or detriment, or makes no difference?

It really depends.

A public sector employee earns 2/80ths of their pension for every year of service (aka it takes 40 years to reach a full pension).

A full pension typically is 1.5 times final salary as a tax free lumpsum + half career average salary as an annual pension.

The annual pension is reduced by the prevailing rate of the contributory old age pension using a formula known as COPC.

So- depending on when someone joins the public sector and the pension scheme they find themselves on- they find themselves on- it would not be out of the ordinary for someone to find themselves in this situation:

Final salary 60k

Lumpsum 90k
Pension rights 30k of which 17.5k is a public sector pension and the remainder is the COAP.

The contributory old age pension does not vest until 67- and its thought it could increases to 70 or even higher in future years (I don't think people realise just how bankrupt our pension system is).

Potentially on retirement the employee could have their 90k lumpsum, and a pension of 17.5k for a number of years- before the COAP would vest.

For this- depending on circumstances and the scheme they are on- they pay between 9.2% and 16.1% (assuming a gross salary of 60k). The percentage will vary depending on a number of different circumstances.

The pre-1995 staff- are a completely different kettle of fish- and are not entitled to claim the PRSI based COAP- but get their pension after 40 years of years of service anytime from age 60 onwards, as a single pension for the public sector, administered by DSP as a separate scheme payment.

What is key really- is when the person joined the public sector- anyone from pre-1995 has a far better pension arrangement- than post 1995- and there are a number of key dates post 2000 on which pension schemes changes (always to the detriment of the employee).

The public sector schemes you hear about in the media the whole time- tend to be the pre-1995 schemes (and most certainly not the current scheme- which is no-where near as generous).

The_Conductor

The_Conductor wrote: »

Potentially on retirement the employee could have their 90k lumpsum, and a pension of 17.5k for a number of years- before the COAP would vest.

That's not true. Public sector workers are - disgracefully - paid a supplementary pension as a replacement for the rising OAP, in affect raising the OAP impacts private workers only

The_Conductor wrote: »

For this- depending on circumstances and the scheme they are on- they pay between 9.2% and 16.1% (assuming a gross salary of 60k). The percentage will vary depending on a number of different circumstances.

That's a complete lie. Someone on 60k in the post 1995 scheme pays about 7.8% of their total salary in contributions, legacy and asc.

There are thresholds below which no deduction is applied, (€24000 for the net deduction, €34000 for the asc deduction), apart from the 1.5% gross.

It's astounding how people in the civil and public sector on Boards continue to peddle lies and mistruths on how much they contribute to their pensions.

floorpie

The_Conductor wrote: »

It really depends.

A public sector employee earns 2/80ths of their pension for every year of service (aka it takes 40 years to reach a full pension).

etc.

This is really helpful, thanks

shesty

It's like this OP.......you can lose that private sector job.
Having worked in both, that little fact creates a very different atmosphere in a private sector office.You do have this thing always hanging over you that you have to put your best foot forward all the time, and do whatever that may require.It is not the same in the public sector.I have never really lost that feeling myself.
For that pay, you will have to give quite a lot to be honest. Are you in a personal position to do that, with your kids??
I mean the private sector isn't bad, a lot of nonsense that goes on in the public sector isn't there, but I would think very carefully about that move.You would probably get back in ok, having watched a good few people move back and forth over the years.

beauf

You've also got to consider if you'll get 40yrs service and/or be able to buy back years if short.