Facing redundancy is never easy. Between the emotional toll and the financial uncertainty, it’s natural to feel overwhelmed. But amidst all the immediate concerns—finding your next role, managing household bills, perhaps retraining—there’s one crucial aspect that often gets overlooked: your pension.
If you’ve been made redundant or are facing the possibility, understanding what happens to your redundancy pension is absolutely vital. Your workplace pension represents years of contributions and compound growth, and the decisions you make now could significantly impact your retirement income decades down the line. At Money Maximising Advisors Limited, we’ve guided countless individuals across Dublin, Galway, and throughout Ireland through this challenging transition, helping them protect and maximise their retirement savings.
This comprehensive guide will walk you through everything you need to know about pension options after redundancy in Ireland, from understanding your rights to making informed decisions about your financial future.
Understanding Your Pension Rights After Redundancy Ireland
When you’re made redundant, your employer cannot simply take away the pension contributions you’ve built up. These are your entitlements, protected by Irish law. However, what happens next depends entirely on the type of pension scheme you’ve been contributing to.
Occupational pension schemes are workplace pensions set up by your employer. If you’ve been enrolled in one of these, you’ve likely seen regular deductions from your salary, often matched or supplemented by employer contributions. When redundancy strikes, these accumulated funds don’t disappear—but they do need to be managed properly.
Defined benefit schemes promise you a specific income in retirement, usually based on your final salary and years of service. If you leave before retirement age, your benefits are typically ‘preserved’—held in trust until you reach the scheme’s retirement age. Your preserved pension Ireland remains within the scheme, growing modestly until you can claim it.
Defined contribution schemes, on the other hand, work differently. Your pension pot is the total of all contributions made plus investment growth. When facing redundancy, you have several options for what to do with this accumulated fund, and choosing the right path is crucial.
What Happens to My Pension If I Am Made Redundant in Ireland?
This is the question we hear most often at our offices in Dublin and Galway. The short answer: it depends on your circumstances, but you always retain your pension rights.
Your workplace pension redundancy Ireland situation will follow one of these paths:
If you have less than two years’ service: Some schemes may allow you to take a refund of your own contributions (though not your employer’s contributions), minus tax. However, this is rarely the best financial decision, as you’ll lose valuable retirement savings and pay tax on the withdrawal.
If you have two or more years’ service: Your benefits must be preserved. You cannot simply cash them out. Instead, you’ll need to decide how to manage these preserved benefits going forward.
The good news? You have time to make this decision. You don’t need to rush into anything immediately after redundancy. Take the breathing space to understand your options properly—this is where professional guidance becomes invaluable.
Many people don’t realise that their pension rights after redundancy Ireland are comprehensive and well-protected. The Pensions Authority oversees these protections, ensuring that employees aren’t left vulnerable when employment relationships end.
For detailed guidance on managing your overall redundancy situation, explore our guide on Redundancy Pension in Ireland: A Complete Guide to Protecting Your Financial Future.
Pension Options After Redundancy Ireland: What Are Your Choices?
Once the dust settles after redundancy, you’ll need to decide what to do with your accumulated pension benefits. Here are your main options:
1. Leave Your Pension Where It Is (Deferred Benefits)
You can leave your pension pot in your former employer’s scheme as a ‘preserved’ or ‘deferred’ member. Your fund continues to be invested, and you’ll receive your pension when you reach the scheme’s retirement age.
Advantages:
- Simple option requiring no immediate action
- Fund continues to grow through investment returns
- Remains under professional management
Disadvantages:
- You lose control over investment decisions
- May incur ongoing administration charges
- No flexibility if your circumstances change
- Cannot make additional contributions to grow the fund faster
2. Transfer to a New Employer’s Scheme
If you’ve secured new employment with a pension scheme, you might transfer your existing pension pot into your new employer’s plan.
Advantages:
- Consolidates your pensions in one place
- Potentially better investment options or lower charges
- Employer may match your transferred contributions
Disadvantages:
- New scheme may have restrictions or less favourable terms
- Transfer values aren’t always straightforward
- Some schemes don’t accept transfers
Employers navigating staff changes should read our Step-by-Step Redundancy Advice Ireland for Employers for comprehensive guidance.
3. Transfer to a Personal Retirement Savings Account (PRSA After Redundancy)
This is often the most flexible option. A PRSA after redundancy allows you to take full control of your pension savings.
Advantages:
- Complete control over investment choices
- Flexibility to make additional contributions whenever you can afford them
- Portable—stays with you regardless of employment changes
- Competitive charges and transparent fee structures
- Access to professional fund management
Disadvantages:
- You’re responsible for managing contributions
- Investment risk rests with you
- Requires active decision-making
If you’re considering this route, enquire now to speak with our qualified financial advisors who can assess whether a PRSA suits your circumstances.
4. Transfer to a Buy-Out Bond
A buy-out bond (also called a Personal Retirement Bond or PRB) is specifically designed for transferring pension after redundancy. It’s essentially a personal pension plan that holds your transferred benefits.
Advantages:
- Wider range of investment funds than typical occupational schemes
- Professional investment management
- Can consolidate multiple pension pots
- More control than leaving benefits in old employer scheme
Disadvantages:
- Cannot make additional contributions (unlike a PRSA)
- Charges vary between providers
- Requires careful provider selection
To discuss which option best suits your situation, you can book now for a personalised consultation with our Certified Financial Planners.
Can I Access My Pension Early After Redundancy in Ireland?
This is another frequently asked question, and the rules here are quite specific. Generally speaking, you cannot access your pension before age 50 simply because you’ve been made redundant—even if you’re experiencing financial hardship.
However, there are specific circumstances where early access might be possible:
- If you’re aged 50 or over, you may be able to take early retirement and access your pension
- If you have a serious illness that significantly reduces your life expectancy
- If the transfer value of your pension is very small (currently less than €20,000)
Important warning: Even when early access is permitted, it rarely represents good financial planning. Accessing your pension early means:
- Your fund has less time to grow through compound investment returns
- You might face higher tax liabilities
- Your retirement income will be permanently reduced
- You could exhaust your pension savings before reaching State Pension age
Our advice at Money Maximising Advisors is always to view your pension as exactly what it is: money specifically for your retirement. Short-term financial pressures are real and challenging, but depleting your retirement fund creates long-term problems that are far harder to solve.
For information about your immediate financial entitlements, read our article on Understanding Redundancy Payment Options in Ireland.
Personal Pension After Job Loss Ireland: Maintaining Your Retirement Plans
Losing your job doesn’t mean your retirement planning must stop. In fact, maintaining momentum with your personal pension after job loss Ireland is crucial for long-term financial security.
If you’re unemployed:
- You can still make pension contributions to a PRSA or personal pension
- Contributions qualify for tax relief at your marginal rate (20%, 40%, or even 52% for high earners in previous employment)
- Even small, regular contributions help maintain your retirement savings trajectory
- The power of compound growth means contributions made in your 40s and 50s are especially valuable
If you’re starting self-employment:
- A PRSA or personal pension becomes even more important as you won’t have an employer scheme
- You can make substantial contributions and claim significant tax relief
- This can be an effective way to reduce your tax liability while securing your retirement
The reality is that career paths in 2026 rarely follow the traditional linear trajectory. Job changes, career breaks, periods of self-employment, and yes, redundancy, are increasingly common. Having a redundancy and retirement savings Ireland strategy that adapts to these changes is essential.
Do I Keep My Employer Pension If I Lose My Job in Ireland?
Yes, absolutely. Your pension rights are protected by law. Your employer cannot take back the contributions they’ve made or the investment growth your fund has experienced. These benefits belong to you, though they’ll be subject to the rules of the pension scheme regarding when and how you can access them.
What you do lose when you leave employment is:
- Future employer contributions
- The benefit of employer matching
- Access to potentially favourable group scheme charges
This is why acting decisively to continue your pension contributions in some form—whether through a new employer scheme, PRSA, or personal pension—is so important.
How Does Redundancy Affect My State Pension in Ireland?
Your State Pension (Contributory) entitlement is based on your PRSI contributions throughout your working life, not on your employment status at any given moment. Redundancy affects this in specific ways:
If you’re unemployed and claiming Jobseeker’s Benefit or Allowance:
- You continue to receive ‘credits’ that count toward your State Pension
- These credits protect your contribution record during unemployment
- Your State Pension entitlement isn’t damaged by short-to-medium periods of unemployment
If you’re unemployed but not claiming benefits:
- You won’t receive credits
- Gaps in your PRSI record can reduce your eventual State Pension
- Long gaps can be particularly damaging
If you move to self-employment:
- Class S PRSI contributions count toward State Pension (Contributory)
- The contribution rate differs from PAYE employment
- Your entitlement continues to build
The crucial point: your occupational or personal pension and your State Pension are separate. The State Pension currently provides around €14,000 annually (as of 2026) and will form the foundation of your retirement income, but it’s rarely sufficient alone. This is why protecting your workplace pension redundancy Ireland or establishing a personal pension after job loss Ireland remains vital.
To understand all your entitlements, read Redundancy in Ireland: Implications and Entitlement.
Should I Transfer My Pension After Redundancy in Ireland?
Whether transferring your pension makes sense depends entirely on your individual circumstances. There’s no one-size-fits-all answer, which is why speaking to qualified financial advisors is so valuable.
Consider transferring if:
- Your former employer’s scheme has high charges
- You want greater investment flexibility and choice
- You’re unlikely to return to employment with access to that scheme
- You want to consolidate multiple pension pots for easier management
- The scheme has restrictive rules around retirement age or benefit options
Consider leaving it where it is if:
- The scheme has excellent, low-cost investment options
- You have a defined benefit pension with guaranteed income
- You’re close to the scheme’s retirement age
- Transfer penalties apply
- The scheme provides valuable death-in-service benefits
Red flags that suggest you need professional advice:
- Anyone contacting you unsolicited about transferring your pension
- Promises of unusually high returns
- Suggestions to invest in unregulated or high-risk assets
- Pressure to make quick decisions
Pension scams have become increasingly sophisticated. Always work with regulated advisors—our team at Money Maximising Advisors Limited are fully qualified QFAs and CFPs, regulated by the Central Bank of Ireland. We put your interests first, always.
To explore whether transferring makes sense in your situation, contact us for an obligation-free initial discussion.
Is It Better to Move My Pension Into a PRSA After Redundancy?
A PRSA offers flexibility that’s particularly valuable if you’re facing career uncertainty. The ability to make contributions when you can afford them, pause contributions when you can’t, and maintain full control over investment choices makes PRSAs an excellent option for many people in redundancy situations.
A PRSA might be right for you if:
- You value flexibility and control
- You’re moving to self-employment or contract work
- You want to consolidate multiple pension pots
- You’re actively engaged with your retirement planning
- You want transparency around charges and investment performance
Other options might suit you better if:
- You’re moving to a new employer with an excellent pension scheme
- You have a defined benefit pension that guarantees income
- You prefer a completely hands-off approach to pension management
- You’re very close to retirement and don’t want to disrupt your plans
For personalised guidance on whether a PRSA suits your circumstances, book an appointment with our Certified Financial Planners who can model different scenarios based on your specific situation.
Making Your Decision: Next Steps for Your Redundancy Pension
Redundancy represents a crossroads in your financial life. The decisions you make about your pension now will echo through your retirement years—so it’s worth taking the time to get them right.
Your action plan:
- Gather information: Request a leaving service statement from your employer’s pension scheme showing your accumulated benefits and transfer value
- Understand your options: Review each option carefully, considering your age, employment prospects, financial circumstances, and retirement goals
- Seek professional advice: Pension decisions are complex, and the stakes are high. Professional guidance isn’t an expense; it’s an investment in your financial future
- Don’t delay indefinitely: While you shouldn’t rush, leaving decisions unmade for years can mean missing opportunities or incurring unnecessary charges
- Think holistically: Your pension decision should fit within your broader financial plan, considering your mortgage, life insurance, emergency savings, and other priorities
For comprehensive guidance on typical financial outcomes following redundancy, see our analysis: What is the Average Redundancy Package in Ireland?
It’s also worth understanding the legal distinctions around employment ending—our article on What is the Difference Between Redundancy and Termination? clarifies these important differences.
Beyond Pensions: Holistic Financial Planning After Redundancy
Your pension is crucial, but it’s just one piece of your financial picture. At Money Maximising Advisors Limited, we take a comprehensive approach to financial planning that addresses:
- Emergency funds: Building or maintaining a cash safety net to handle unexpected expenses
- Life insurance and protection: Ensuring your family’s financial security even if your circumstances change
- Mortgage and debt management: Strategies for managing mortgage payments during career transitions
- Tax planning: Maximising tax relief on redundancy payments and pension contributions
- Estate planning: Ensuring your wealth passes efficiently to your loved ones
If you’ve received a redundancy payment, you might also be considering gifting some funds to family members. Our guide on How Much Money Can You Gift to a Family Member Tax-Free in Ireland? explains the Capital Acquisitions Tax implications.
Conclusion: Taking Control of Your Retirement Future
Redundancy doesn’t have to mean retirement insecurity. With the right knowledge and professional guidance, you can navigate this transition while protecting and even enhancing your long-term financial wellbeing.
Your redundancy pension represents years of contributions and investment growth. Whether you choose to leave it preserved, transfer to a PRSA, move it to a buy-out bond, or roll it into a new employer’s scheme, the key is making an informed decision that aligns with your broader financial goals.
At Money Maximising Advisors Limited, we’ve helped hundreds of individuals across Dublin, Galway, and throughout Ireland make confident pension decisions after redundancy. Our team of Certified Financial Planners and Qualified Financial Advisors bring decades of combined experience to every client conversation, providing personalised advice grounded in deep expertise.
Don’t let uncertainty paralyse you. The sooner you take control of your pension planning, the better positioned you’ll be for a comfortable retirement. Contact us today or book an appointment to discuss your specific circumstances. Your future self will thank you.
Frequently Asked Questions
1.What happens to my pension if I am made redundant in Ireland?
Your pension benefits are protected by law and remain yours. If you have less than two years’ service, you may be able to take a refund of your own contributions. With two or more years’ service, your benefits must be preserved, and you can choose to leave them in your former employer’s scheme, transfer to a new employer’s scheme, move them to a PRSA, or transfer to a buy-out bond.
2. Can I access my pension early after redundancy in Ireland?
Generally, you cannot access your pension before age 50 simply due to redundancy. Early access is only possible in specific circumstances: if you’re aged 50 or over and taking early retirement, if you have a serious illness significantly reducing life expectancy, or if your pension value is very small (under €20,000). Early access typically results in reduced retirement income and potential tax penalties.
3. Should I transfer my pension after redundancy in Ireland?
Whether to transfer depends on your individual circumstances. Consider transferring if your former scheme has high charges, you want greater flexibility, or you’re consolidating multiple pensions. However, if you have a defined benefit pension, excellent investment options in your current scheme, or are close to retirement, leaving it may be better. Professional advice is strongly recommended.
4. Do I keep my employer pension if I lose my job in Ireland?
Yes, all contributions made to your pension—both your own and your employer’s—belong to you and are protected by law. You retain these benefits even after redundancy, though you lose access to future employer contributions and any matching arrangements. Your preserved benefits remain yours until retirement.
5. How does redundancy affect my State Pension in Ireland?
Your State Pension is based on your lifetime PRSI contributions, not your current employment status. If you claim Jobseeker’s Benefit or Allowance while unemployed, you receive PRSI credits that protect your State Pension entitlement. However, extended periods of unemployment without claiming benefits can create gaps in your PRSI record that may reduce your eventual State Pension.
6. Is it better to move my pension into a PRSA after redundancy?
A PRSA offers excellent flexibility, allowing you to make contributions when you can afford them and maintain control over investments. This makes it particularly suitable if you’re moving to self-employment, contract work, or facing career uncertainty. However, if you’re joining a new employer with a strong pension scheme, that might offer better value. The best choice depends on your specific circumstances and future employment plans.
Disclaimer: This article provides general information and should not be considered personalised financial or tax advice. Irish pension and tax laws change periodically, and individual circumstances vary significantly. Pension decisions have long-term implications for your retirement security and should never be made without proper consideration. Always consult with qualified financial advisors or tax professionals before making significant pension or financial decisions.
