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Consolidating Pensions

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  • 04-04-2016 11:34am
    #1
    finzaz
    Registered Users Posts: 8 ✭


    Late last year I left my job of four years where I joined the group pension scheme and managed to save €35k before I finished up. I'd like to retire with enough for a monthly income of €2.5k - 3k (I'm 36 and have no other pension funds other than the one above).

    I know I can't continue to pay into my group scheme, but since I'm in an industry where changing jobs every 3-4 years is normal I don't want to retire with ten or more funds (this seems messy).

    Is there a way I can consolidate my pensions? Is it better to get an independent fund set up, or just move everything into each group scheme I have the opportunity to join as I change jobs?
    Tagged:


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    #2
    Merowig
    Registered Users Posts: 413 ✭✭Merowig


    Does your former employer continue to pay for the administration fees of that fund?
    If this is the case it could make sense to keep the fund there.

    With an independent fund you are the one who is covering for the costs.


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    #3
    finzaz
    Registered Users Posts: 8 ✭finzaz


    I'm pretty sure my former employer will continue to pay for the administration fees.

    Although if I were to join a new fund where I'm working now and just transfer everything into this, and do the same again when I move job in the future, is that a simpler way of building up my pension, or is putting 'all my eggs in one basket' not a wise move?


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    #4
    Merowig
    Registered Users Posts: 413 ✭✭Merowig


    Not every employer will continue to cover the fund administration costs after you have left.

    I have a PRSA my employer made contributions to some years ago - and I still kept it though I have now as well a new DC fund with the same employer.
    I have pension entitlements from my home country and from the Irish state and as I doubt I will retire here I will get most likely more enititlements form other places as well...

    For me diversification is not a bad thing as long as it doesn't result in unreasonable additional costs etc.

    It also depends what kind of invesment options the fund of the new employer has - and you can compare then as well fund performance.
    (Though past performance is no gurantee of future performance ;) )
    I would also check what the policy is of the fund of your next employer in regards to administration charges after leaving employment. If they are saying that after leaving you will bear the costs it doesn't make sense to transfer your current fund to that new one.


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    #5
    PaulM1977
    Banned (with Prison Access) Posts: 210 ✭✭PaulM1977


    You have 4 options open to you with your paid up pension benefits from your previous employer:

    Leave it where it is and draw down the benefits at retirement age
    Transfer to your new employer scheme
    Transfer to a PRSA and continue to make payments in to this plan so as to have funds available for your retirement
    Transfer it in to a Buy Out Bond in your own name, you can gain access to the Buy Out Bond at age 50 if required.


    Charges are important and more than likely the charges are being taken from your pension fund so check what they are and compare against your new employers scheme and what is available with the Buy Out Bond option.

    PaulM


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