Primary School Teacher to start own Company: Pension Implications

ned

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I have worked in the public service (Primary School Teacher) for 9 years (all pensionable service) and am now considering starting a company in the next 3 to 4 years.

I am 33 years of age. However, I am not sure what my options are regarding my pension.
As I am in a defined benefit scheme, a lot will depend on my final year salary with the Department of Education.

I wonder if anyone could answer some of the following questions:

If I leave in 2010 and then retire in 2033, will my pension be based on my exit year salary 2010 (50000-55000) or will it be adjusted for inflation to the salary scale of 2033.?

Can I/Should I buy back some years through AVCs before I leave?

If I re-enter the profession for one year- lets say the year before I am due to retire, will my pension be based on this year’s salary or is it taken as an average of a greater number of years?

Would I be better off to bring the pension with me and add it to my Company Director Pension Scheme or should I leave it as it is?

All comments/insights/suggestions would be greatly appreciated!
Thanks guys/gals.
 
Re: moving from public service to start own Co.

  • In the public sector the pension at retirement is usually based on salary scale at retirement (not your salary in 2010) even for people that leave before retirement date
  • You can buy years through AVCs, make sure there are no conditions attaching to your purchase (i.e. that you do not have to be there until retirement to get benefit of these)...if there are no conditions it would be a reasonable strategy
  • If you manage to reenter the profession later - that will be a COMPLETELY separate arrangement to your previous pension accrued - so it will have no impact on the pension that you previously built-up which will be based on service to (for example) 2010
  • You usually cannot take a pension "with you" from the public sector to a private pension plan
 
Hi Ned,

Welcome to AAM!

You should get a hold of the scheme booklet which outlines the rules of the National School Teachers' Superannuation Schemes.

You should also contact the INTO who know a bit about pension arrangements for National School teachers.

The Department of Education may be worth contacting as well.

Primary Pensions
Department of Education and Science
Cornamaddy
Athlone
Co. Westmeath
Tel: 090 6483993


Did you start teaching after 1995? If so, you are paying PRSI at the full rate and your eventual pension is reduced by the amount of the contributory old age pension.

aj

CC
If you manage to reenter the profession later - that will be a COMPLETELY separate arrangement to your previous pension accrued - so it will have no impact on the pension that you previously built-up which will be based on service to (for example) 2010

I could be wrong but as far as I know if you reenter the profession at a later date and are allowed back into the superannuation scheme that your service continue to accrue.
 
I could be wrong but as far as I know if you reenter the profession at a later date and are allowed back into the superannuation scheme that your service continue to accrue.

In the private sector it would certainly be separate.

I would not think it would make any difference in public sector either way because pay grades are determined by salary scales and either way the service will be rated against this pensionable salary to calculate the pension...so either way the benefit would be the same.
 
Im sorry CCC, but I dont understand what you are trying to say here:

In the private sector it would certainly be separate.

I would not think it would make any difference in public sector either way because pay grades are determined by salary scales and either way the service will be rated against this pensionable salary to calculate the pension...so either way the benefit would be the same.
 
I am sorry that you dont understand it.

The deferred pension based on service to 2010 added to the pension that would be accrued by rejoining say in 2030 and serving to 2035 would give the same benefit at retirement as service to 2010 then rejoining in 2030 and serving to 2035 and being allowed to include previous service when rejoining in 2030.

Maybe if you do out an example with real numbers it will help you to understand my point.
 
From the INTO website.
Teachers who are returning to the service and have completed their probation are placed on the point of the incremental scale at which they left off.
If they have not withdrawn their contributions to the pension fund their previous service is recognised in full for purposes of the superannuation scheme.

Enquiries to Primary Teachers' Pension Section, Department of Education and Science, Cornamaddy, Athlone, Co. Westmeath. Tel (0902) 74621 or (01) 873 4700.
 
Thanks Folks,
I'll call Department of Education and I.N.T.O. and see what they have to say!!
 
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