starting PRSA at 57, is it worthwhile?

M

metromary

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The offer of government contribution to pension fund if using some SSIA money has me investigating starting a pension fund. I'm 57 and on Invalidity pension. I have checked with revenue and I am eligible for the government top-up. I could continue to contribute about €150 per month. Is this worthwhile, or would I be better putting my SSIA funds into high earning deposit account? I can't afford to take risks with it. I had thought of Eagle Star through an on-line execution only broker (thanks to info on AAM). Would the need for details from SSIA provider and declaration of earnings which have to be supplied to pension provider, who then applies to Revenue for the top-up preclude the use of execution only broker, as I don't relish paying up to 5% per annum commission. Any advice at all on what would seem best for my situation would be much appreciated.
Mary:confused:
 
One issue: if your current income is fairly low, and you may not be paying any income tax, then you would not avail of tax relief on your pension contributions.

However, you would get the 2500 SSIA PITC.
 
My father started an Eagle Star PRSA AVC at age 60, but gets substantial tax relief on his contributions, making it worthwhile.
 
Thanks Protocol. As I'm included on my husband's self-employed tax return, I don't really know how much, if any, tax I'm paying. My concern is, other than the government top-up of my SSIA, with charges on a PRSA and with the fact that at this stage the investment would be safe rather than dynamic, would I be better just investing in a decent deposit account? If I could invest through an execution only on-line broker, it might make PRSA worthwhile. However if up to 5% per annum was being deducted, it's hard to see it gaining much in perhaps 8 years.
Mary
 
All good points.

My father used www.labrokers.ie, and paid 150 fixed fee to set up the Eagle Star PRSA AVC. As he was 60 they hummed and hawed a bit, and said they could only offer a 98% allocation rate, instead of 100%, as the policy would only last 2-3 yrs.

However, in the end, he got 100% allocation. But that may not always happen.

I now see that LA Brokers don't seem to charge at all for setting up the PRSA.

The tax relief is key to this decision.
 
L.A. broker responded very quickly to my query and without any setup charge I can open an Eagle star PRSA for just the 1% management. However, as I'm low earner and would pay little or no tax, I'm wondering if PRSA is the way to go with my SSIA funds, or would I be better putting into RABO and drip feeding a couple of the 7% regular savings accounts. Of course, I would not then get the government top up of my SSIA. Any advice out there?
Mary
 
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