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Taking early retirement from Civil Service to work in the Private Sector

  • 27-05-2022 11:01am
    Registered Users Posts: 4,033 ✭✭✭ gazzer


    Over the last number of months I have been considering taking early retirement from the Civil Service. I think a combination of the pandemic and the benefits of wfh have made me realise that commuting 3 hours a day to work isnt something I need to do anymore. Though I am currently only working 2 days in the office the future is unknown until the offical blended working policy is implemented. It could well be that I would need to work 3 or 4 days in the office.

    I have 31 years in the Civil Service (pre 1995) and I have the option of the Cost Neutral Early Retirement scheme. I am considering opening a last minute AVC to make up the shortfall for my lump sum and thinking of retiring at the end of the year. My lump sum payment would be good enough (around 70k tax free) but my weekly pension would be 350 euro a week. As I pay Class D PRSI I would not be entitled to any state pension. I just have this 'life is too short' mentality for a while now and would like to move into a new career path, be it my own small business or even working part time at something I would enjoy. I just love the idea of working in an area that I would get much more back from (maybe working with a charity or working in the community)

    I am lucky in that our mortgage is manageable, no children and my partner works full time. Im aware of the tax implications of getting a pension and working but even if I worked say 20 hours a week. I would have much more time to go to the gym, take up more hobbies, do college courses. I wouldnt be taking much less home then I currently am (about 100e a week) when you take into account the commuting costs to travel to Dublin from where I live, plus the long commute I have to and from work. I had applied for the mobility scheme to be nearer home but I have not moved much up the list in the last year so that is not going to happen anytime soon. In addition I am the LSI scale so my salary will not increase for another 2 1/2 years (not including any pay agreements).

    I also thought that as I would be 51 I still have a good number of years to work in the private sector, pay Class A PRSI and be able to avail of a State Pension in addition to my CS pension when I hit my late 60's. I still have a lot of thinking to do about this and want to give myself enough time to make an informed decision.

    So I have two questions.

    1. Am I crazy to even consider this
    2. Has anybody here done what I am thinking of doing and if so how did it work out for you?

    Sorry for the long post.