Are you pre 95 ?
If you are and you retire at age 54 you would have plenty of time to get reckonable Prsi contributions until age 66. This could allow you to make up for the financial hit by gaining a significant portion of the contributory pension.
This is entirely up to you. The actuarial reduction factor is the actuarial reduction factor and it's there to take or leave. Whether you think it's a good sacrifice depends on a lot of things. How much do you want to spend in retirement, what are your obligations, will you have dependents, is your mortgage paid off, etc.Has anyone looked into how this is calculated if this option is a good financial option?
This is a very important point and in future they will only be made less advantageous than if you retire today. Irish life expectancy has increased (in particular for men) well ahead of expectations in the last decade. Life expectancy for Irish men is now the highest in Europe.I doubt they would be as favourable if they were being calculated afresh now.
I don't know about actuarial calculations but the reduction factors date from almost 20 years ago. As average life expectancy has increased in the meantime I doubt they would be as favourable if they were being calculated afresh now.
the difference in annual pension between taking the actuarial reduced early retirement next year or retiring next year and awaiting a deferred pension at age 60 is approx 5k per year.
Presumably they would have a few years of pre establishment contributions. Add in pre entry and change of status credits and they could possibly achieve 14 or 15 years of Prsi contributions. They might qualify for roughly 90 euro a week.Bear in mind that the revised State contributory pension system (which is due to commence next year) will mean that someone who only starts making reckonable PRSI contributions at age 54 would only be eligible to receive about 27%* of the full pension by retirement age. In 2023 terms that would be about €72 a week gross.
* [11X52]/2080
You're dead right. Increased life expectancy should lead to lower actuarial reductions, not greater. This is probably why the factors haven't been adjusted in 20 years.Does increased life expectancy favour the Preserved option in terms of monetary value? If so, there is no case for increasing the CNER actuarial reduction factor to reflect increasing life expectancy? Maybe the opposite?
Building up extra Prsi needn't necessarily be the goal, but it is definitely worth keeping in mind. Various ways can be used to get extra paid contributions to reach the 520 full rate paid level. These do not necessarily involve full time employment. Presumably the poster would already have a few years of A class paid. If they manage to reach 260 paid A, they would then be able to make voluntary contributions, as they will have the required 520 paid contributions, (in order to be eligible to make voluntary contributions) when they include their B or D paid contributions.definitely do Not leave your job if the intention is to build up future PRSI contributions with the hope of getting an extra pension from the state at 66. There my words to the wise!
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