AVC advise

Smartfc

Looking for some AVC advise. I am 35, and can afford to put €100 per month into an AVC. I earn approx €75k per year. I have been working in the public sector for about 15 years. I am a bit of a DIY man and would like to try and navigate, with boards.ie help the AVC world. Would love a step by step guide if anyone has done it. Ideally would like a one time setup and forget about if for a few years but happy to upload certs to the revenue annually if required. Thank you all in advance.

Geuze

Smartfc wrote: »

Looking for some AVC advise. I am 35, and can afford to put €100 per month into an AVC. I earn approx €75k per year. I have been working in the public sector for about 15 years. I am a bit of a DIY man and would like to try and navigate, with boards.ie help the AVC world. Would love a step by step guide if anyone has done it. Ideally would like a one time setup and forget about if for a few years but happy to upload certs to the revenue annually if required. Thank you all in advance.

As you started working in the PS aged 20, you will have full pension service, 40 years paid, by age 60.

I think this will reduce/restrict, but maybe not eliminate the possibility of doing AVCs?

coylemj

Geuze wrote: »

As you started working in the PS aged 20, you will have full pension service, 40 years paid, by age 60.

I think this will reduce/restrict, but maybe not eliminate the possibility of doing AVCs?

But isn't the new PS pension based on average earnings? Whereas the maximum pension benefits you can take on retirement (without upsetting the taxman) are based on final salary.

So wouldn't there be a gap (final-average) that could be bridged with an AVC?

killbillvol2

coylemj wrote: »

But isn't the new PS pension based on average earnings? Whereas the maximum pension benefits you can take on retirement (without upsetting the taxman) are based on final salary.

So wouldn't there be a gap (final-average) that could be bridged with an AVC?

It depends on when the OP started. If they started 15 years ago they should be on the old system. The career average system started in 2013.

Smartfc

Thanks all...is there an online calculator to find out what I can contribute?

coylemj

Smartfc wrote: »

Thanks all...is there an online calculator to find out what I can contribute?

There are two issues here.....

1. At age 35, the maximum you can contribute (and get tax relief) is 20% of your salary. This includes any current (mandatory) contribution you are making to your pension.

2. You're not allowed to overfund your final pension and if you do, the taxman may seek to claw back the relief you got from the contributions that pushed your final pension (including your occupational pension) over the allowable limit. That is the point being made by poster Geuze in post #2 above.

I'm not sure what the taxman considers to be the maximum allowed (with tax relief) pension. It may be 2/3 of final salary. In which case, if your pension plan is based on 40/80 (one half) of final salary after 40 years, you may be allowed to fund up to a pension of 2/3 of final salary.

Static M.e.

Smartfc,

if you contact Cornmarket they will give you a free assessment over the phone and send you a report afterwards. Probably the easiest and best way to approach it. You could then look for more information on the back of the report once you have some answers.

alig1234

Yes Irish Life and Zurich both have pension calculators on their websites easy to use