Despite the financial uncertainty of current times, it’s beyond debate that you have to plan if you want to turn those retirement dreams and aspirations into reality when you stop working. As you may be retired for up to a third of your life, you need to have the financial supports in place well before you retire.
Most of us can identify with statements like:
- I don’t really understand pensions, but I want to have enough money to live comfortably when I retire.
- I’m not sure how much my pension will give me each year, or how much I will need once I retire.
- I want to be able to continue my current lifestyle once I finish working
- I want to have enough money to travel, and have a nice quality of life when I retire
The basic questions you need to answer are:
What sort of a retirement do you picture for yourself?
Now that people are living longer - and are more active in their older years – there’s a wide range of possibilities open to you if you plan well. Begin by thinking about your preferred lifestyle once you finish working. Will you want to travel to foreign places, pursue new hobbies, or be totally involved with the family? All of these will take a regular income to make it happen.
What is a Pension?
A pension is essentially a long-term savings plan that’s locked away until you retire. It has the added benefit of tax relief on the amount saved. This means that every Euro you invest in your pension fund receives a generous top-up from the State. In some cases, your employer will also contribute to your pension, making it an even wiser long-term saving strategy.
What’s the normal retirement age?
The age you are eligible for the State Pension (contributory) is 66. This was meant to be extended in 2020 to 67 from 2021 and 68 from 2028. However, in Budget 2021, it was announced that the qualifying age for the State Pension would remain at 66.
If you choose to retire before aged 66, you could have a gap in your retirement income.
Being informed and making a plan is the first step to getting your pensions sorted.
Getting help
Putting the right plan in place for you depends on:
- your current age
- your expected retirement date
- the lifestyle you want when you retire
- what you can realistically afford to save.
Disclaimer
Life assurance and pensions products are provided by New Ireland Assurance Company plc., trading as Bank of Ireland Life. New Ireland Assurance Company plc., trading as Bank of Ireland Life is regulated by the Central Bank of Ireland.
Advice on Bank of Ireland Life products is provided by Bank of Ireland, trading as Bank of Ireland Insurance & Investments. Bank of Ireland trading as Bank of Ireland Insurance & Investments is regulated by the Central Bank of Ireland.
Bank of Ireland is a tied agent of New Ireland Assurance Company plc trading as Bank of Ireland Life for life assurance and pensions business.
Members of Bank of Ireland Group.
