I think that's a fair assessment.. except that the future income will be higher than the current income forgone due to growth in the pension fund. This can be significant due to compounding. It also ignores the preferential tax treatment of the 25% lump sum.
So it's a choice between income now...
I'm not a fan of pension charges or the level of transparency in pension products. But your statement feels like more like a conspiracy theory than an objective opinion based on fact.
You can take 25% of your pension as a lump sum when you retire. The first 200k of the lump sum is tax free and the next 300k is taxed at 20% and the rest is taxed at 40%. If your pension fund is worth less than 800k when you retire, all of your lump sum will be tax free.
So if you contribute...
I think Gordon means that they are tax free while they are growing and that therefore tax does not reduce the compounding effect which is the greatest benefit of a pension, even if they are taxed at withdrawal.
For example, if you were to contribute €1000 to your pension with 20% tax relief...
I'm in a similar situation. I am maxing out my pension contributions at present and I expect that my total income in retirement will be about 42k.
Of course that's based on lots of assumptions. If my ARF performs better than I expect, then I have the 'problem' of having to pay higher rate tax...
Moving house is very stressful. It involves difficult choices which in retrospect can look very wise or foolish. There were risks attached to the choice you did take but there were no doubt risks to holding on to your original house as well.
The downside now is delays and rental costs.
If you...
So - I was interested to know if there is any pattern to how the TER varies. I imagined that no pattern in how the TER varies could be a genuine tracking error.
So I plotted the TER (i.e. the difference between the Irish Life self-created benchmark and the actual performance) for 4 funds for...
I had hoped that by choosing a fund with the word 'index' in the title, I would have some hope of a reasonably transparent passively managed fund. Using that figure of 11.53%, it seems like the TER is closer to 1.65% than 1%.
Unfortunately, this is a PRSA with my current employer so I don't...
No - there is no TER quoted. Here is a link to one of the factsheets here.
In fact, it is not even clear which benchmark they are following. They just say they are using some unspecified benchmark for comparison.
Just doing a little financial housekeeping and I decided to check the AMC on my Irish Life Pension.
All of my money within this pension is in index funds as below so I used the fund factsheets to compare the actual performance with the underlying benchmark. The fund factsheets state that the...
You could do just what you say and it would be very close.
It might be slightly more correct to increase your living costs every year by the expected inflation rate and then use that figure to calculate your pension drawdown for each year...
I have been thinking about the same scenario also but I think variability in market return will catch you out here. If the market goes up 20%, your €1m is now worth €1.2m and your 4% minimum withdrawal is now €48k and you are paying higher rate tax. Given that markets can often have a few...
I just wanted to share my experience of trying to withdraw funds from a matured savings certificate in State Savings which are in my sole name.
I am fully set up on the online platform and my bank account details are provided.
5th Oct – I requested online for my funds to be part reinvested in...
Is there an equivalent to the Deposit Guarantee Scheme for pensions? I have searched both AAM and the web more generally and I can't seem to find one.
Or is it just the case that client funds are held separately in pensions (similar to investment brokers) and that is considered sufficient...
I believe there was a suggestion that the employer contribution to a PRSA would not count towards the age related contribution limit given that the employer contribution is not limited. Does anyone know if that is the case?
Thanks...
Hi,
I am a regular PAYE worker and my tax situation is very straightforward. I am married but we are taxed under separate assessment. The only thing slightly out of the ordinary is that I fill out Form 11 each year - but this only as I have some ETF investments that I need to declare.
I have...
I noticed that on my Quinn Freeway funds, the number of units increases by 0.5% each year on the statement. They do not point it out or explain why so I assume that this is the mechanism whereby they reduce the AMC by 0.5%.
I suppose this would make sense as the original AMC is probably baked...
Hi Homefish,
The way it works is that the Local Authority are the planning authority and they decide to grant permission or not. TII (formerly the NRA) are a consultee when the site is adjacent a National Road. So if you apply for planning, the LA will invite comments from TII but are not...
I must try that too - I just Googled the UK Government Gateway and I am struggling to see where to register. Is it the same as registering for HMRC online services?
Thanks...
https://www.gov.uk/log-in-register-hmrc-online-services