Previous Defined Contribution Pension
Are you currently employed in a reputable company or the public sector in Ireland? If so, have you made any retirement plans? If not, now is the time to start thinking about your future so that when you retire, you can enjoy your life without worrying about your finances.
A previously defined contribution pension is a type of pension scheme in which the amount of money you’ve contributed and the performance of your investments determine the value of your defined contribution pension. It typically pays you a retirement income based on your earnings while working. It functions more like a tax-advantaged savings account. You contribute to your pension pot, and your employer may also contribute. In addition, your pension provider claims tax breaks on your behalf and deposits them into your pension pot.
WHO QUALIFIES FOR THIS PENSION SCHEME?
- Must be a resident of Ireland
- Must be classified as a worker and have a signed contract with your employer
- Minimum earning must be € 10,000 per year
- Must be above 60 years of age to claim your retirement fund
- Most employers offer this pension plan to their employees.
MAKE YOUR FUTURE MORE SECURE WITH A PREVIOUSLY DEFINED CONTRIBUTION PENSION PLAN
Previous Defined contribution pension plans are an excellent, tax-efficient way to save money for retirement by employed individuals.
A Defined Contribution plan includes a fixed contribution for the employee and a fixed contribution for the employer. In some DC plans, for example, the employer and the employee each contribute 5% of the member’s earnings, for a total contribution of 10%.
Some previously defined contribution schemes allow members to select the level of contribution they wish to pay, along with a corresponding employer contribution. When you retire, you will have several options for your defined contribution pension. You can take a lump sum withdrawal of up to 25% of your pot without being taxed on it. You can choose to invest the remainder or purchase an annuity from another provider, which will provide you with a steady income for the rest of your life.
For advice on setting up a previously defined contribution pension plan, contact our expert financial advisors today!
Benefits Of Previous Defined Contribution Pension Plan
- Significant monetary benefits can be earned over a short period, even with early retirement.
- You can claim 20% to 40% tax relief depending on your age.
- Offers a predictable and guaranteed benefit, and the benefits are not dependent on asset performance.
- High level of flexibility over when and how you access the money in your pot