Personal Pension and PRSAs

[phared]

I have a personal pension with an Irish pension provider. My new employers agreed to contribute to my pension. Having contacted my pension provider to arrange for payments, I discovered that I now have two pensions. My personal pension & a PRSA. The reason given was that it was in my best interest to have a PRSA as the fees were lower. My payments into my Personal Pension have ceased and I have been told that the government has not enacted legislation to allow the transfer of these funds into my PRSA. The personal pension is now sitting there gathering dust.

I am unsure of what to do next.

 

[Guest]

Unless it provides you with lower charges, more flexibility and/or less administrative hassle there is no advantage necessarily in merging different pension funds into one. Having more than one pension fund is not unusual and is not necessarily a problem assuming that the charges and fund options are reasonable. I myself have four different funds that I've accumulated over the years for example. Your existing ("paid-up") personal pension scheme will continue to grow in line with the underlying funds/assets even if no further contributions are made to it. Check what the ongoing charges are (e.g. monthly policy fee possibly charged even when no further contributions are made, annual management fee etc.) to make sure that they are not onerous. In the meantime if a PRSA is the only option open to you in terms of availing of employer contributions then it will probably make sense to go with that. Ideally get a better deal on charges that the standard PRSA charges caps of 5% on contributions and 1% p.a. management fee if possible - e.g. it is sometimes possible to pay a fixed fee to an intermediary in order to avail of a 0%/1% charging structure. If in doubt about any of this stuff you should consider obtaining independent, professional advice on the matter perhaps from an authorised advisor or maybe a multi-agency intermediary but not a tied agent.