Media Q&A: If I invest in an Approved Retirement Fund when I retire, will I be able to change my mind?

I will be retiring next year and am deciding whether to use my retirement savings to buy an annuity or invest in an Approved Retirement Fund (ARF). If I change my mind about the annuity shortly after I buy it, can I cash it in at that stage or switch to an ARF?

Under current Revenue rules, it is not possible to cash in or surrender an annuity once it’s up and running, said Mark Reilly, pension proposition lead at Royal London Ireland. Neither is it possible to make any changes to the annuity, such as the rate of escalation, he said.

This applies if you have bought an annuity and your annual pension increases at a fixed rate each year, or change it from a single life annuity, where your pension simply stops when you die, to a joint survivor annuity. Annuities are designed to provide security and consistency of income during retirement, and it is this peace of mind which is the reason annuities are often favoured over ARFs.

You can opt for an ARF at retirement and then subsequently switch to an annuity. However, the opposite is not possible. A big advantage of ARFs is that any money remaining in your ARF after your death can be left to your next of kin or family. This isn’t always the case with annuities, unless you have set up your annuity to continue to be paid to your spouse or dependents after your death. Seek professional advice from a broker before deciding between an annuity and ARF, Mr Reilly said.

ENDS

This article was published in The Irish Independent on 21 March 2026.