AVC's - do I need to go through Broker/Company

[niceoneted]

I'll be eligible to retire in about 6.5 years, but can work longer if I so choose.
I'm on public sector pension pre '95.
I'm currently not contributing to AVC's.
I want to make the the tax rebate on Pensions while I have some cash free.
Question is do I have to go through a broker/company (Irish life/Zurich/Cornmarket or the likes) or is there a way of doing it on my own.
I do not want a fund where I have to commit a certain amount every month but I would like to do a once off payment for every year that I have spare cash between now and retiring.
I have read loads around it but I hit a wall when I hear the word pension for some reason - in my own head!
TIA

 

[Conan]

Most Public Sector groups have a Union based AVC Scheme, often operated through Cornmarket ( a Broker). This works well (reasonably) where you are contributing monthly and getting tax relief at source.
However if you propose to contribute a series of one-off lump sums then the “salary deduction “ approach will not work. You will have to make a tax return to get the relief back.
If you want to manage this yourself, you can establish a “stand-alone PRSA AVC” product.
Using such a vehicle to maximize your tax-free lump sum on retirement (if you have short service or income that is non-pensionable) is very tax effective.

 

[mula]

I'll be eligible to retire in about 6.5 years, but can work longer if I so choose.
I'm on public sector pension pre '95.
I'm currently not contributing to AVC's.
I want to make the the tax rebate on Pensions while I have some cash free.
Question is do I have to go through a broker/company (Irish life/Zurich/Cornmarket or the likes) or is there a way of doing it on my own.
I do not want a fund where I have to commit a certain amount every month but I would like to do a once off payment for every year that I have spare cash between now and retiring.
I have read loads around it but I hit a wall when I hear the word pension for some reason - in my own head!
TIA

You will have to use a Avc or PRSA AVC so you have to use a pension provider such as zurich or irish life but you dont have to use a broker.

However unlesss you are 100% sure how to calculate your expected pension and lumpsum and what is the maximum you can fund for which can often be more the 1.5 of final salary for the lumpsum etc then i would not recommend doing it yourself.

you could under fund or over fund which is not ideal. Also you would need to be comfortable calculating the max you can contribute for tax relief in order to make sure you get the maximum benefit ie all at the top rate each year.

My advice is go to a independent non union affiliated public sector pension advisor pay a fee and have them do the calcs for you. Avoid the Union crowds like Cornmarket fees are too high and they will push products you dont need.

Mula

 

[Steven Barrett]

You will have to use a Avc or PRSA AVC so you have to use a pension provider such as zurich or irish life but you dont have to use a broker.

However unlesss you are 100% sure how to calculate your expected pension and lumpsum and what is the maximum you can fund for which can often be more the 1.5 of final salary for the lumpsum etc then i would not recommend doing it yourself.

you could under fund or over fund which is not ideal. Also you would need to be comfortable calculating the max you can contribute for tax relief in order to make sure you get the maximum benefit ie all at the top rate each year.

My advice is go to a independent non union affiliated public sector pension advisor pay a fee and have them do the calcs for you. Avoid the Union crowds like Cornmarket fees are too high and they will push products you dont need.

Mula

If you do not use an advisor, you get the direct sales team from the life company you speak to. So what you is getting is a tied agent.

Back to the OP, you do not have to make a monthly contribution, you can make once off lump sum payments if you wish and claim the tax relief back from the Revenue.

Do you have to go through a licenced insurance company to handle your contributions? Yes, you do. This is for your protection that companies have to authorised by the Central Bank and hold certain amounts of capital in reserve and who have stringent reporting obligations to the regulator. Otherwise, rogue companies would be popping up everywhere and stealing peoples money.

Public service pensions can be complex as there are a lot of different schemes and rules depending on when you joined. The likes of Cornmarket, while expensive, have the resources and expertise in calculating the maximum tax free lump sum under your particular circumstances. If you don't need anything technical calculated, you can go to any other advisor.

And if you hit a wall when you think of pensions, why wouldn't you hire an expert to do it for you? If you don't have the skills to do it, why wouldn't you pay someone to do it right for you? Even though I can look up most DIY jobs on youtube, I'd still hire someone so I know it's fixed correctly and much quicker than I'd do it myself.


Steven
www.bluewaterfp.ie

 

[niceoneted]

Thanks for the feedback folks. I will ring around on Monday as I am aware I need to get the ball rolling if I want to do one for 2017.