State contributions/ benefit at retirement

D

deco87

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Hi see screenshot- year 2022 - I work and pay A Prsi stamp weekly.
I seem to be paying 52 M stamps - and on top of that 10 credited contributions and 48 A stamps- seems a lot of activity!! I was expecting just to see the A stamps !!

Would that stamps be correct -

I retired March 2020 public service -35 years ......
I commenced job the next week - paying A stamp .......
I work the school calendar year .........
I sign on for job seekers / credits , when school closes .......

I just want to be sure I'm contributing correctly for benefits at retirement - am 58 now

Appreciate any advice -.....
Hope it's in correct post - I see a lot of Prsi related posts in this section ....Brendan
 

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PRSI Class M is for pension income (your PS pension, presumably). It is at 0% rate. It doesn't count towards the state pension or jobseekers.

You have 52 reckonable Class A contributions - 48 paid and 4 credited. These do count.
 
Early Riser said:
PRSI Class M is for pension income (your PS pension, presumably). It is at 0% rate. It doesn't count towards the state pension or jobseekers.

You have 52 reckonable Class A contributions - 48 paid and 4 credited. These do count.
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Thank you
 
Make sure that you maintain your Prsi record at least until the end of the calender year of your 63rd birthday. If you cease working before age 63 keep signing on for A credits and continue until age 66. Also make sure you meet the 13 paid contributions rule. This will allow you to qualify for the 65s benefit. Check the "Operating guidelines for 65s benefit".
 
Thanks very much , what's the 13 paid contribution rule I wonder - depending on the health !!! I'd hope to work till near 70 along the school calendar year - paying the A stamp and credits - regards ,.D
 
My quick analysis of your situation, based on the limited information regarding your PRSI contribution record that you provided is as follows:

If you look at your screenshot, you'll note that the two columns on the right include the word "RECKONABLE" in the header.
They're the two columns that matter to you.

To be eligible for the State Contributory pension, the total number of contributions in the column headed "Reckonable Paid Contributions" must reach at least 520 by the end of the year before you reach pension age. [To be eligible for what is called the pro rata pension for mixed contributions, you'll need to have made at least 260 fully paid contributions (Class A or S) - but that's another story that I won't go into here].

On 1 Jan 2023 your record extract shows a total of 152 reckonable paid contributions.

You are currently aged 58, which means that you will turn 66 (State pension age) sometime in 2031.

By 31 December 2030 if you maintain your current PRSI contribution pattern, you will have made 336 (48*7) more reckonable paid contributions.

This will give you a total of 488 reckonable paid contributions - which is below the 520 threshold.

So you would need to keep working and making PRSI contributions during 2031 to get you past the 520 point. (By then I assume that the PRSI rules will allow this.) Then you could apply for the pension in 2032, aged 67.

This is based on the current contributory pension regulations which may well be revised in the next few years.
 
The year of your 63rd birthday is called the governing year.
You need 13 paid A contributions in that year or either of the two years before this or the next year or the second year after.
i.e. one of the following..... the year of your 61st, 62nd, 63rd, 64th or 65th birthdays.

Also following on from Shirazman's post. You should check your Prsi record to see if you have any pre establishment paid A contributions. These would help get you past the 520 contributions required.
 
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Shirazman said:
To be eligible for what is called the pro rata pension for mixed contributions, you'll need to have made at least 260 fully paid contributions (Class A or S) -
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But he should qualify for a pro-rata pension as he will comfortably surpass the 260 threshold. After that both paid and credited full rate contributions count. The more he can accumulate the better. I don't think that getting over the 520 paid contribution threshold is a deal breaker in this scenario.
 
S class said:
It might not be a deal breaker but it is well worthwhile aiming for.
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Sure - but he is committed to work from now until pension age. There is not much else he can do. It shouldn't make that much difference to his State Pension anyway. And he already has a PS pension.

S class said:
The normal pension calculation method will nearly always result in a higher pension than the pro rata calculation.
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Is that because the total number of contributions (full and modified) will generally exceed 2080?
 
Early Riser said:
Is that because the total number of contributions (full and modified) will generally exceed 2080?
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Yes. The pro rata calculation will probably span from the first payment of Prsi until the last payment of Prsi. If a person started work at 18 and claimed credits until age 66 their pro rata calculation will be based on 48 years. The normal pension calculation will be based on 40 years. Dividing by 48 will give a smaller pension compared to dividing by 40.

Aiming to reach 520 full contributions is very beneficial to a mixed class contributor reaching age 66 at present as they will have an average of 10 -14 contributions per year and get a pension of 106 euro per week. Unfortunately the poster will miss out on most of this extra benefit.
 
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S class said:
Aiming to reach 520 full contributions is very beneficial to a mixed class contributor reaching age 66 at present as they will have an average of 10 -14 contributions per year and get a pension of 106 euro per week. Unfortunately the poster will miss out on most of this extra benefit.
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That is with an averaging approach which will have been phased out before this poster reaches State Pension age.

As I see it he will have a minimum of 260 contributions for a pro-rata pension. He will have about 520 total contributions, a few of which will be credited but will still count. His pension will be this number multiplied by the then current State Pension, divided by his total number of combined contributions. Using this approach there really should be little difference, between having 520 fully paid Class As or 480 fully paid and 40 credited ones.
Using the TCA approach a total of 520 paid-only contributions would yield him €66.30 pw at today's rates. I don't know how the TCA approach works in relation to a pro-rata pension. But even basing it on a total record of 48 years would yield our poster about €55.30 pw.

The bottom line as I see it is that he should not lose any sleep over this. He has a PS pension. He has got a post-retirement job which he enjoys and through which he will build up a pro-rata State Pension (and the other Class A safety net features). There is little more he can do other than try to change jobs to one which guarantees 52 paid PRSI contributions per year, or get a second job during school holidays. Unless he is unhappy with what he is currently doing then he should just forget about this and enjoy life.
 
Early Riser said:
But he should qualify for a pro-rata pension as he will comfortably surpass the 260 threshold. After that both paid and credited full rate contributions count. The more he can accumulate the better. I don't think that getting over the 520 paid contribution threshold is a deal breaker in this scenario.
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That isn't in dispute.

However, he/she asked for advice and I offered some, on the assumption that, like any intelligent PRSI payer, s/he was hoping to qualify for the Contributory State Pension!
 
Lads thanks so much for all this detail which is really interesting and informative-really appreciate all your contributions - I see had a few alright of A contributions before public service ! All helps
 

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deco87 said:
Lads thanks so much for all this detail which is really interesting and informative-really appreciate all your contributions - I see had a few alright of A contributions before public service ! All helps
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That's good news! Assuming that you keep paying 48 Class A PRSI contributions annually, then those 42 extra paid Class A contributions will get you over the 520 threshold by end 2030!
 
S class said:
Yes. The pro rata calculation will probably span from the first payment of Prsi until the last payment of Prsi. If a person started work at 18 and claimed credits until age 66 their pro rata calculation will be based on 48 years. The normal pension calculation will be based on 40 years. Dividing by 48 will give a smaller pension compared to dividing by 40.

Aiming to reach 520 full contributions is very beneficial to a mixed class contributor reaching age 66 at present as they will have an average of 10 -14 contributions per year and get a pension of 106 euro per week. Unfortunately the poster will miss out on most of this extra benefit.
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Yup I did get a few ok from before joining public service thanks a lot
 
S class said:
Make sure that you maintain your Prsi record at least until the end of the calender year of your 63rd birthday. If you cease working before age 63 keep signing on for A credits and continue until age 66. Also make sure you meet the 13 paid contributions rule. This will allow you to qualify for the 65s benefit. Check the "Operating guidelines for 65s benefit".
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What’s the 13 th paid contribution rule I wonder ?
 
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