Thousands of Irish people are losing out on significant retirement wealth – often without even realising it.
There’s an estimated €500 million in forgotten pensions in Ireland, while many are contributing to underperforming pension funds or not taking full advantage of tax relief.
With these issues in mind, this guide explores three simple strategies you can take to achieve the retirement you deserve.
1. Track Down Lost Pensions
Many Irish workers have pension pots from previous employers, particularly if they have changed jobs many times or worked abroad. Smaller pensions can easily be forgotten and left sitting in underperforming funds.
Tracing and consolidating these old pensions into one arrangement can make it easier for you to manage, in terms of monitoring performance and understanding charges.
This can also reduce duplicated fees and costs, which can quietly erode long term growth.
So if you think you may have an old pension somewhere that you’ve lost or forgotten about, you might be wondering how to go about tracing it and reaping the benefits. Fortunately, this is a relatively simple process.
To locate any missing pension plans, you should consult a financial advisor, who may be able to help you with the process. Your advisor will need your name, date of birth, your current address and your PPS number (or foreign equivalent, such as your UK National Insurance Number).
Once your old pensions have been located, you have a few options. You may choose to leave them as they are and manage them individually or explore whether you can combine them into a new pension plan. You might be eligible to transfer an old pension into a PRSA, or even cash it in if you are over 50.
You can begin your journey to tracking down lost pensions today by taking a 90-second pension review below.
2. Check Fund Performance and Fees
Fees matter more than you might realise. A difference of just one percent per year in fees can significantly reduce your final pension value over decades due to the compound effect.
Many savers remain invested in default funds that may no longer match their age, appetite for risk or retirement timeline.
Reviewing where your contributions are being invested and how your pension funds have performed over time will allow you to decide whether a different fund strategy could improve your overall pension pot.
3. Use Tax Relief to Your Gain
Pension contributions in Ireland qualify for tax relief at your marginal rate, subject to age related limits. Depending on your age, you could contribute up to 40% of your earnings and receive tax relief, significantly boosting your retirement income.
The current age related limits for tax relief are:
| Age | Maximum % that qualifies for tax relief |
| Under 30 | 15% |
| 30 to 39 | 20% |
| 40 to 49 | 25% |
| 50 to 54 | 30% |
| 55 to 59 | 35% |
| Over 60 | 40% |
If you’re not contributing up to your allowable percentage of salary, you may be missing out on valuable tax relief. Increasing your pension contributions, even slightly, could have a powerful long term impact, and is another simple but effective way of maximising your retirement savings.
