If you have previously worked in a company that provided a defined benefit pension to its employees, then due to recent legislation changes, you may be able to get early access to your pension fund.
In June 2016, the then Minster for Finance, Michael Noonan, introduced legislation that allows certain deferred DB pension holders a new and alternative option of accessing their pension money from age 50 onwards (as opposed to 60 or 65) with the old traditional option.
The new option allows you to ‘swap’ your pension income at retirement age for a ‘once off’ lump sum of money. This lump sum can be accessed from age 50 provided that you and/or your employer meet certain criteria.
Deferred pension holders of such companies as Eircom, Intel, An Post, ESB etc. have all been offered ‘Enhanced Transfer Values’ with this new drawdown pension option.
This new option is relatively unknown to many HR and admin departments of DB pension companies and many deferred pension holders as a result, have not been made aware of this option.
The transfer values offered to deferred DB pension holders are actually calculated by their ex employers pension trustees department. These values can go up and down over a period of time.
Whether or not this is the preferred option for you, there is absolutely no harm in requesting a transfer value from your employer to assess all of your options. You can then make an informed decision of what is the best option for you and your financial future.
The video below is an explainer video walking you through a real life example.