Help with pension decisions.

S

shaggy

Registered User
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Hi

Earlier this year I switched jobs. My old job operated a group scheme defined benefit pension and as I am 50 I have a few options regarding that pension.
I cannot transfer it directly to my new pension un fortunately.
My new job is with the HSE and has a public sector pension.

What I would like to do is get a maximum tax free lump sum from my old pension and transfer the remainder into an ethical fund which could later be transferred to my new pension after the 2 year vesting period.

I would like to be able to make additional payments into this fund as AVCs to make tax free savings.
As the goal is to transfer the funds into the public services pension as soon as the 2 year vesting period is up I would go for a self managed fund with minimal set up costs.
And it is important to me that it is an ethical fund.

I'm guessing the answer is an ethical self managed PRSA???
Any advice or suggestions.
 
If you withdraw your lump sum from your existing pension fund, then you are "retiring" that fund and your only options with the balance are post-retirement options - AMRF & ARF or annuity. After retiring a fund you cannot then amalgamate the funds back into a pre-retirement pension scheme, like an AVC. Pre-retirement vehicles and post-retirement vehicles don't mix.

As a very general rule, I don't recommend that people access their pension funds before they have actually retired, but individual circumstances may make it worthwhile accessing the lump sum. If yours do, then you can take the lump sum from the existing scheme now and re-invest the balance in an AMRF/ARF or an annuity. Your AVCs into the HSE scheme will need to be entirely separate - either AVCs arranged through whoever has the in-house AVC scheme - possibly Cornmarket - or an AVC PRSA of your own choice.

I'm a bit confused by you wanting a self-managed fund and an ethical fund. I would understand self-managed to mean that you choose your own investments within your AVC PRSA, which is possible. So it would therefore be up to you to pick investments in ethical companies. An ethical fund has a fund manager and is not therefore self-managed.

Regards,

Liam
www.ferga.com
 
Thanks Liam, that has cleared up some confusion on my part.
So from my understanding of the above, it would be possible to go the "not retire" option, transfer my pension into a self managed PRSA (forgoing the lump sum) and make AVCs into that fund.
Is that correct?
 
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