Consumer Question:
I’m in my early 30s. I haven’t yet started a pension. My boss doesn’t offer a company pension scheme so I’m considering setting up my own pension by opening a Personal Retirement Savings Account (PRSA). Should I hold off until auto-enrolment is introduced?
Answer from Mark Reilly, Pension Proposition Lead at Royal London Ireland
It certainly feels like we are getting closer to the implementation of auto-enrolment (AE) retirement in Ireland. The recent publication of the AE Retirement Savings System Bill 2022 is starting to put forward a framework within which AE will operate in Ireland. However, work is continuing on legislation to set up the scheme so it could still be some time before AE gets up and running in Ireland.
The earlier you start saving for a pension, the better. For this reason, it’s worthwhile saving for your retirement by starting a PRSA. You can stop saving into your PRSA if and when AE is introduced, particularly if you are likely to build up a higher pension under AE than through a PRSA. You will not lose the pension benefit you have built up in your PRSA if you stop saving into it – the benefit will remain there until you can access it, which is usually around retirement age. Bear in mind too that while the Government is committed to introducing AE, there is no guarantee that it will go ahead.
To get a PRSA, you must enter into a contract with an authorised PRSA provider. You can get a list of authorised pension providers from the Pensions Authority.
You have a choice between a Standard and a non-Standard PRSA. There is a limit on the charges on your pension with a Standard PRSA. Talking to a Financial Broker can help you choose the right pension product option for you.
ENDS
This question was submitted to and first published by The Irish Independent
About Royal London Ireland
Royal London Ireland has a history of protecting its policyholders and their families, and it is committed to continue to do so for a long time to come. Our businesses heritage in Ireland is 190 years starting when the Caledonian Insurance Company's first office opened on Dame Street, Dublin 2 in 1834. Today, Royal London Ireland is owned by The Royal London Mutual Insurance Society Limited – the UK’s largest mutual life insurance, pensions and investment company, and in the top 30 mutuals globally, with assets under management of €197 billion, 8.5 million policies in force, and over 4,400 employees. Figures quoted are as at 30 June 2024.
Royal London Ireland’s office is based at 47-49 St Stephen’s Green, Dublin 2.