Require help with Pension decision

[Seaview]

Age: 43
Spouse’s/Partner's age: 55

Annual gross income from employment or profession: Unemployed
Annual gross income of spouse: 600 per week gross

Type of employment: e.g. Civil Servant, self-employed Labourer/Spouse

In general are you spending more than you earn or are you saving? saving

Rough estimate of value of home 450,000
Amount outstanding on your mortgage: Nil
What interest rate are you paying?

Other borrowings – car loans/personal loans etc Nil,

Do you pay off your full credit card balance each month? yes
If not, what is the balance on your credit card?

Savings and investments: 27,000 in a high interest account and an endowment policy due to mature in the next year with a projected maturity value of 45,000 pounds from England.

Do you have a pension scheme? me no / spouse yes

Do you own any investment or other property? no

Ages of children: 2 have grown up and left home, 1 still at home aged 16

Life insurance: yes


What specific question do you have or what issues are of concern to you?
Although we have no outstanding debt, I am worried that I have made no provision for a pension for myself. I am unsure if I should start a PRSA and invest the proceeds of the endowment policy when it matures or wait until I find employment and join a company pension scheme. I have just completed a four year degree course and I am looking for an admin job. My husband is working in the construction trade and has approximately 90,000 in a pension schemes both here and in the UK. He has worked very hard all his life and at the moment I am worried about his health and I don't think he will be able to continue in this area until he is 65. We still have one child to put through college and would consider downsizing to a smaller house in the future. We manage ok on a day to day basis but I am bothered about the pensions.

 

[so-crates]

Seaview, I would agree with you. You are comfortably off with no mortgage and no outstanding debt. You are in a good albeit later position to start a pension. Just a couple of questions occur to me. You say the endowment policy will not mature until next year, are you considering taking up employment prior to that?
I would suggest that maybe you start by looking at what the Pensions Board has to say. In particular I would suggest you look at the following booklets:
Women and Pensions
What are my Pension Options
PRSAs - A Consumer Guide

 

[Seaview]

so-crates Thank you for your reply. The endowment policy is due to mature in March 2009. I intend to take up employment as soon as I can get a job, although at the moment, it is proving more difficult than I envisaged.

I will read through the links you provided in the Pension Board website. I think I would prefer to avail of a company pension scheme if at all possible, and then use the proceeds of the policy to make additional AVC contributions to both our pensions subject to the required age limits.

In the past couple of years my husband has been paying a once off annual payment of 5000 Euro as an AVC to his CIF pension and afterwards he claims back the tax relief and PRSI contribution on it. I read here that if a person is only paying tax at the 20% tax bracket that it is not a good idea to make AVC's. I am unsure as to why this is so and would appreciate if anyone could explain. Thank you