The research Aviva has conducted into Ireland’s pension position indicates that as a nation, we are not saving enough for our retirement. Aviva has developed Mind the Gap – a simple calculator to enable you to work out your own retirement position.
By answering a few simple questions, you can get an indication of your own individual pension gap – and what measures you can take to address them.
Based on your salary and age, did you know you can contribute a maximum of €0 per month towards your pension. Remember, the more you (and your employer) can pay into your pension, the greater the target income in retirement you can aim for.
The good news is that these contributions qualify for tax relief at a rate of 20% based on your current salary of €0
If you don’t have a financial broker and need further information on financial brokers in your area, the following websites provide further details.
The Professional Insurance Brokers Association
The Irish Brokers Association
WARNING: The value of your investment may go down as well as up.
WARNING: If you invest in these products you may lose some or all of the money you invest.
WARNING: If you invest in these products you will not have any access to your money before you retire.
WARNING: These products may be affected by changes in currency exchange rates.
WARNING: Withdrawals and switches from funds investing directly or indirectly in property may be deferred for up to 6 months.
WARNING: Withdrawals and switches from all other funds may be deferred for up to 3 months.
Why do I have no state pension?
The Government issued their National Pensions Framework document in 2010. Within this document was a recommendation to increase the age at which people qualify for the State Pension.
For example, if you are aged 35 today, you will not qualify for the State Pension until you reach age 68. Therefore, if you had hoped to retire at age 65, you may have to fund an even larger Pensions Gap.
You should speak to a Financial Broker for all the help you need in closing your pension gap.
Regular contributions are paid in advance (i.e. at the start of each month). Regular contributions go up by 3% per annum each year over the term of your plan. Contributions are invested in a Simple PRSA0 product, which has a fund management charge of 1% per annum and a contribution charge of 0% of each contribution.
The projected values assume an investment growth before retirement of 5.05 % per annum. This rate is for illustrative purposes only and is not guaranteed. Actual investment growth will depend on the performance of the underlying investments and may be more or less than illustrated.
The assumed inflation rate for present day values and values at retirement is 3% p.a.
The illustrations contained in this quotation follow the guidelines issued by the Society of Actuaries in Ireland.
The annual rate used to calculate the estimated pension is based on a post-retirement interest rate of 3% per annum and is in line with the guidelines issued by the Society of Actuaries in Ireland.
The estimated annuities quoted are payable monthly in advance and guaranteed for 5 years and life thereafter:
The annuity rate used assumes an attached spouse's annuity of 50% of the main life's annuity which is payable on the death of the main life. Annuity payments increase by 2% per annum.
The annuity rate used is a long term average rate and is not guaranteed. The actual annuity rate available at retirement may differ from the annuity rate used in the illustration. Different annuity options can be chosen at retirement.
Under the new National Pensions Framework, the age at which people qualify for the State pension will increase over time – to 66 years of age in 2014, 67 in 2021 and 68 in 2028. The amount payable may vary depending on certain criteria being met. The State Pension (Contributory) remains at 11,976 p.a. in today’s terms.
Disclaimer: The assumed inflation rate for present day values and values at retirement is 3% p.a. All values are for illustrative purposes and are not guaranteed. In accordance with the Finance (No 2) Act 2011, an annual stamp duty of 0.6% of the value of pension funds was introduced by the Government. In accordance with the Finance (No. 2) Act 2011, an annual levy of 0.6% of the value of your pension fund was introduced by the government for 2011, 2012, 2013 and 2014. The Finance (No.2) Act 2013 changed the levy rate for 2014 to 0.75% and extended the levy for an additional year to 2015 at a reduced rate of 0.15%. The levy is payable on the value of your pension fund on 30th June each year. Aviva Life & Pensions Ireland Limited will deduct this levy from your pension fund and pay it to the Revenue.