Early Encashment

[PBarry]

Hi guys,
just a question on behalf of my mother.

She has recently received details of a small BOI Retirement Bond from an old workplace. The value of it as of a few months ago was €7,600. Projected policy value at age 60 (2019) is €9,000.

If she was to cash it now would she receive the full €7,600? Are there any other advantages/disadvantages to cashing out now?
EDIT: The policy did state: "There are no early encashment charges."

Would be very grateful of your help on this.

 

[moneybox]

If she was to cash it now would she receive the full €7,600? Are there any other advantages/disadvantages to cashing out now?

.

Trolley

She may be liable for tax and USC on the proceeds. She needs to check with her tax office to see what these charges might add up to.

 

[Steven Barrett]

You didn't say how old she is.

She is entitled to a tax free lump sum based on years service. It will be reduced if she draws it down early. That may use up the entire value of the fund. If not, she can take what is called a trivial pension i.e. the remainder of it as a lump sum and pay tax at 10%.

Steven
www.bluewaterfp.ie