Can you have a PRSA as well as an occupational pension

J

jobchanger

Guest
Hello

I have recently been made redundant (after 3 years) and I am currently doing contract work until I get a permanent job.
I now have 2 options regarding my pension from my previous employer (a) transfer value or (b) leave in fund.
I am thinking of setting up a PRSA (and transferring my fund value) and when I get a permanent job also joining the company pension scheme,is it legally possible to join & contribute to both schemes at the same time?(assuming you keep under the limits).
What are the pros and cons of contributing to 2 schemes?
Also,what are the "good" value PRSA available in terms of low charges?

Thanks
 
> I now have 2 options regarding my pension from my previous employer (a) transfer value or (b) leave in fund.

You should presumably also have the option of transferring to a buy out bond?



> I am thinking of setting up a PRSA (and transferring my fund value)

When deciding to transfer from one scheme to another you should pay careful attention to the charges and the other pros and cons (e.g. impact on flexibility, investment options etc.). While transferring from an occupational scheme to a PRSA is supposed to be allowed in theory, in practice I'm not sure if many (any?) pension providers are actually facilitating this at the moment.

> and when I get a permanent job also joining the company pension scheme

There is nothing to stop you opening a PRSA and contributing to it while you are not in employment that offers an occupational scheme and, when you join a company with an occupational scheme joining that if it makes sense from the point of view of charges etc. The decision to transfer funds from one occupational scheme to another is a separate one. Note that in doing so you can transfer in vesting periods which may be useful for the purposes of securing employer contributions sooner than might normally be allowed.

> is it legally possible to join & contribute to both schemes at the same time?(assuming you keep under the limits).

I'm not sure and I'm not sure why one would want to. Check the PB site for info on this:

www.pensionsboard.ie

> What are the pros and cons of contributing to 2 schemes?

Ultimately you need to compare different options in terms of stuff like charges, flexibility, investment options, advice provided (if necessary) etc. If you browse back through some of the existing topics in this forum you should get more food for thought.

> Also,what are the "good" value PRSA available in terms of low charges?

Standard PRSAs have charges cappped at 5% of each contribution and 1% annual management charge. In some cases it's possible to reduce these charges to 0%/1% by arranging the PRSA through a broker (usually on an execution only, nil commission basis) for a fixed fee of c. €100-€200. It may also be possible to get a good deal on charges with a non PRSA personal pension plan.

Note that if you are going to be contracting for any extended periond of time then there may be other pension options open to you as a self employed person.

If in doubt seek independent, professional advice:
 
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