paddington
Registered User
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- 2
I am 51 and started teaching in 2010 i.e. post 2004 so retirement age is set at 65 (but can take cost neutral retirement from 55 but won't be able to access the state pension part of that until 65 I believe (as supplementary pension)). So I suppose I am concerned about the years between retirement (60-62) and state pension age (65 hopefully or possibly 68 if I am wrong about accessing the supplementary pension at 65? Post http://www.askaboutmoney.com/threads/public-service-pension-advice.190760/#post-1411175 seems to indicate 65 is correct.)
I have pension funds from previous private sector work which currently hold about 300k.
I would probably aim to retire sometime between 9 and 12 years from now and would like to put more into my pension pot. I am not currently entitled to purchase Notional Service as my employment is not permanent and in any case this might not be the best option for me given the previous paragraph.
Q1: I presume topping up my PRSA (from previous private sector fund) would not be the best as I would not get tax relief?
Therefore I am considering
Option a: an execution only AVC PRSA (possibly with LABROKERS) . I do know I would have to claim back tax relief myself in this case.
OR
Option b: or just regular savings with a possible view to a last minute AVC/PRSA.
Q2: Any advice on options a. vs b.?
Q3: If I choose the AVC PRSA option, is the lump sum allowed the higher of 25% of the AVC value or 150% of final salary.
This would be a big difference for me as my normal gratutity would only be about 20K as I won't have built up much service. If I had 50K in my AVC and if the limit was 150% of final salary I might be able to take all of it tax free. If the limit was 25% and I would only get a 12.5k tax free lump sum. In the latter case I might be better off just having immediate access to my 50K through regular saving (with no tax relief possible).
One further concern:
Q4: I became worried when reading about AMRFs. As I am particularly concerned about the years between my cost neutral retirement age and state pension age I want to avoid having to tie up my limited pension in order to pay an AMRF which I can't touch until I'm 75. Am I correct in saying this can be avoided by simply buying an annuity when I retire? Or having a vested PRSA.
(Note: this post supersedes my previous post "top up existing PRSA vs open a PRSA AVC" which no one has replied to but which unfortunately I can't see how to delete. Perhaps a kind moderator would do so).
I have pension funds from previous private sector work which currently hold about 300k.
I would probably aim to retire sometime between 9 and 12 years from now and would like to put more into my pension pot. I am not currently entitled to purchase Notional Service as my employment is not permanent and in any case this might not be the best option for me given the previous paragraph.
Q1: I presume topping up my PRSA (from previous private sector fund) would not be the best as I would not get tax relief?
Therefore I am considering
Option a: an execution only AVC PRSA (possibly with LABROKERS) . I do know I would have to claim back tax relief myself in this case.
OR
Option b: or just regular savings with a possible view to a last minute AVC/PRSA.
Q2: Any advice on options a. vs b.?
Q3: If I choose the AVC PRSA option, is the lump sum allowed the higher of 25% of the AVC value or 150% of final salary.
This would be a big difference for me as my normal gratutity would only be about 20K as I won't have built up much service. If I had 50K in my AVC and if the limit was 150% of final salary I might be able to take all of it tax free. If the limit was 25% and I would only get a 12.5k tax free lump sum. In the latter case I might be better off just having immediate access to my 50K through regular saving (with no tax relief possible).
One further concern:
Q4: I became worried when reading about AMRFs. As I am particularly concerned about the years between my cost neutral retirement age and state pension age I want to avoid having to tie up my limited pension in order to pay an AMRF which I can't touch until I'm 75. Am I correct in saying this can be avoided by simply buying an annuity when I retire? Or having a vested PRSA.
(Note: this post supersedes my previous post "top up existing PRSA vs open a PRSA AVC" which no one has replied to but which unfortunately I can't see how to delete. Perhaps a kind moderator would do so).