PRSA figures for fourth quarter 2007

Friday 8 February 2008: The Pensions Board today announced fourth quarter data for Personal Retirement Savings Accounts (PRSAs), received from all ten PRSA providers, to the end of December 2007.

The data shows that 130,709 PRSAs have now been taken out, comprising 100,229 Standard PRSAs and 30,480 non-Standard PRSAs, with a total asset value of €1.25 billion. At end of December 2007, 84,557 employers had signed up with a PRSA provider under the employer mandatory access requirements. The data also shows that 45,243 employees have taken out PRSAs through their employer.

The Pensions Board online calculator and pensions information is available on www.pensionsboard.ie.

ENDS

Media queries:

David Malone
Head of Information Services
The Pensions Board
Tel: (01) 613 1900

Jackie Gallagher
Q4 Public Relations
Tel: (01) 475 1444 / (087) 237 1838


Notes to Editors:

About PRSAs
A PRSA is a contract between an individual and an authorised PRSA provider in the form of an investment account that can be used to save for retirement. It is a personal pension plan where the contributions paid are tax deductible and the investment return is tax exempted. There are two types of PRSA - a Standard PRSA and a non- Standard PRSA.

About Mandatory Access – 15 September
All employers were required on 15 September 2003 to enter into a contract with a PRSA provider so that access to at least one Standard PRSA is available for all “excluded employees” on and from that date.

Excluded employees are:

  • Employees of an employer who does not offer an occupational pension scheme, or
  • Employees included in an occupational pension scheme for death in service benefits only, or
  • Employees included in an occupational pension scheme that does not permit the payment of additional voluntary contributions, or
  • Employees who are ineligible to join the occupational pension scheme and who will not, under the rules, become eligible to join the scheme for pension benefits within six months from the date they commenced employment.

Public Information
The Information unit at The Pensions Board provides a wide range of pension information booklets free of charge and can be reached at the LoCall number 1890 656565 and on www.pensionsboard.ie.

PRSA figures at 31 December 2007

Cumulative value of assets: €1,253,022,785.33

Total number of PRSA contracts sold: 130,709

  • Standard: 100,229
  • non-Standard: 30,480

Total number of employers who have designated a PRSA Provider: 84,557

  • number of these designations where contributions are being made: 12,891
  • number of PRSA contracts under the designations: 45,243*

*This figure is included under the total number of PRSA contracts sold

 
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About the Pension’s Calculator

  • This pension’s calculator is designed to give a broad indication of the level of contributions required to give your desired pension at your retirement age. This calculator only provides a sample indication of the funding contributions for your pension and no reliance should be placed on it.
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  • For a full and accurate assessment of your personal finances and any tax relief you may be entitled to on your pension contributions always consult with a professional financial adviser

The next step is to talk to your employer, trade union, bank, insurance company, building society or financial advisor about starting your pension today.

Pension Calculator Notes:
  1. Assumptions used: Investment return will be 5% per year before retirement and 4% per year after retirement. Salary will increase at 3% per year. Pension will increase at 2% per year in retirement. The State Pension will increase in line with salary increases. Spouse's annuity assumes a 3 year age gap between the Main Life and Spouse. Your personal illustration above makes an approximate allowance for the recently introduced Pensions Levy (i.e. 0.6% of your Fund Value) until 2014 or your intended retirement year if earlier.
  2. Contribution amounts shown will increase each year as salary increases.
  3. The actual pension at retirement will depend on actual investment return and salary inflation up to retirement and on the cost of purchasing annuities at retirement.
  4. Tax relief calculations take account of age related limits on tax relief in any given year as prescribed by the Revenue. Your financial advisor will be able to help you to stay within your limits. The maximum tax relief as a % of earnings are as follows:
         Under 30: 15%
         30 to 39: 20%
         40 to 49: 25%
         50 to 54: 30%
         55 to 59: 35%
         60 and over: 40%
  5. Contributions or benefits may exceed limits prescribed by the Revenue. Your financial advisor will be able to help you to stay within your limits. Budget 2011, introduced a Standard Fund Threshold (SFT) of €2.3 million. Individuals with pension funds in excess of this value as at 7 December 2010 may apply for a Personal Fund Threshold(PFT). When the capital value of pension benefits drawn down by an individual exceed his or her SFT or PFT as appropriate, a tax charge of 41% is applied to the excess fund.
  6. In these net contribution calculations, PAYE & single persons tax reliefs and single persons tax bands are assumed. It is also assumed that no other tax reliefs apply.
  7. The annuity rate used to convert your pension fund at retirement age is a long term average annuity rate, which makes no allowance for the recent gender equalisation ruling. The annuity rate used in your personal illustration above will be shown when you run the calculator.
  8. This calculator takes account of the fact that the State Pension (Transition) will no longer be paid from 1 January 2014. This means that there will then be a standard State Pension age of 66 years for everyone. If you have qualified for the State Pension Transition before 1 January 2014 you remain entitled to it for the duration of your claim (1 year). State pension age will increase to 67 in 2021 and to 68 in 2028