Early Pension Release
Cashing in your pension early
Sometimes people need to access cash from there pension early, in which case you may be able to do so from age 50 onwards dependent on the pension plan type and provided you have left that particular employment, the following pension arrangements allow you to do so:
- Defined Contribution Scheme.
- Wound Up Defined Benefit Scheme.
- Personal Retirement Bond.
- Executive Pension Plan.
- Employer-Sponsored PRSA
Accessing Cash in Hand
You can take 25% of your pension pot tax-free (limit of 200k), but before you can take the balance as taxable cash, you will need to have a guaranteed pension income of at least €12,700 per annum or have invested €63,500 in an Approved Minimum Retirement Fund (AMRF) and/or Annuity.
Similarly, if you want the tax-free cash and don’t want to buy an annuity (pension payment for life) you can reinvest the 75% balance of your fund, but you must have a guaranteed pension income of at least €12,700 per annum or invest €63,500 in an Approved Minimum Retirement Fund (AMRF) before investing any balance in an Approved Retirement Fund (ARF).
Early Drawdown Considerations
Early drawdown considerations
It can be tempting to draw down your pension before retirement, especially if you need the finances, but it is ever important to think about this carefully and to get professional advice.
It may be the case that you have more than one pension or have other assets like property, but remember if your pension is well managed from an investment perspective it will grow tax-free prior to drawdown.
If you are under age 50 and concerned about a deferred or frozen pension from a previous employers’ scheme, you may still transfer out to a Personal Retirement Bond to secure the current fund value and control future investment risk.
If this is the case and you are experiencing a serious illness or disability then you can your personal pension at any age.
What are the next steps?
Usually your first contact with us will be a short telephone call or an email. This allows us to understand your situation and let you know how we can help you. A quick phone call or email can often be the easiest way to take the stress out of these decisions.
For most of our clients that initial phone call or email, is where they start to get clarity on the right steps to get the most from their pension.
Please feel free to call us Monday to Friday or to submit an enquiry, with your specific questions.
Phone: 01 845 0049