Cashing in Pension at 50 Ireland - Everything you need to know.
You are here to learn more about cashing in your pension at 50 in Ireland.
The early access rules which apply to each pension type are different. If you want information specific to your pension type our free interactive tool is the easiest way find it.
The tool will ask you some questions to determine your pension type and then it will offer more information on the access options which may be open to you.
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Access Pension Early
Whether or not you can cash in your pension early at 50 will depend on your pension type and current circumstances. Below, you will find more information on accessing both employment pensions and personal pensions early from 50.
Simply select the option most suited to you.
Find out more about the rules which apply to accessing employers pension schemes early from
Find out more about accessing a defined benefit pension early. Get hints and tips on what to look out for to ensure you get a fair deal.
Want to access your PRSA early? Find out more about the rules for early PRSA access.
Find out more about accessing a personal retirement bond early. Find out how early pension access works for you.
Section 1:
Can I Access My Employer Pension Early?
Can You Cash Out A Pension Early?
Employer Pensions
An employer pension scheme is a pension that you held with your employer. They are also known as occupational pension schemes.
These schemes are usually offered to employees when they start a new job or have worked for the company for a set period of time.
Your employer makes contributions to this type of pension scheme but you may also make additional contributions.
The section below contains frequently asked questions on cashing in an old employee pension early at 50.
Yes, it is possible to access an old employee pension from age 50 onwards.
No. In order to access your pension early at 50, you must be a deferred member of the pension scheme you are trying to access.
A deferred member is someone who used to be a member of the scheme but they have now stopped paying in. You become a deferred member when you leave your job and are no longer actively paying into the scheme.
No, for employer pensions the only restriction is that you are a deferred member of the scheme. So, in layman terms it has to be an old pension you are trying to access. You can continue to work as normal for your existing employer while accessing your pension with no issues.
You may have contacted your pension provider and asked about early access. In many cases, your provider may indicate access is not possible until you reach the retirement age of the scheme.
While it is true you cannot access the pension in its current format, a pension advisor can transfer you fund from the existing scheme into a Personal Retirement Bond or PRB.
Once your fund has been moved from your old employers scheme, the age restriction they impose are removed.
Once the transfer is complete, your financial advisor will be able to facilitate early access for you.
"In occupational pension schemes, early retirement is generally possible with the employer’s and/or trustees’ consent from age 50 onwards." - Pensions Authority
It is important to note that your financial advisor will deal with your pension provider directly to obtain the permission needed.
You can withdraw as much or as little of the fund as you want. It is important to keep in mind how any withdrawals will effect your retirement income in years to come.
Your pension advisor will be able to project the reduction in retirement income you can expect based on different withdrawal amounts.
This enables you to make an informed decision regarding early access.
Yes. Regardless of when you access your pension, you are entitled to take a 25% tax free lump sum from the fund subject to a lifetime limit of €200,000.
In some cases you may be entitled to take more than 25% tax free. Your financial advisor will run a number of calculations on your fund to determine the highest tax free amount available to you.
When someone refers to a pension lump sum at 50, they are usually referring to accessing their tax free lump sum only and reinvesting the remainder.
If early access is available to you, you will have the option of taking your pension lump sum at 50 should you want it.
If you withdraw any amount over your tax free entitlement, you will be taxed on the funds taken as if it were income.
So, if your income (including your pension withdrawal) in the tax year you withdraw your fund is below €40,000, you will be taxed at the standard rate of tax at 20%.
If you go over the standard rate threshold of €40,000, you will be taxed at 40%.
Your financial advisor will provide an indication of your tax liability prior to withdrawal.
This enables you to plan your early pension withdrawal tax efficiently.
If you have some room in the standard tax bracket, you may plan two withdrawals over two tax years to reduce your tax liability. Your financial advisor will work with you to limit your tax liability where possible,
This answer to this question is... it depends on your individual situation.
However, your financial advisor will be able to give you a clear recommendation based on your individual needs.
They will check your existing pension provision and advise on whether or not early access makes financial sense for you.
They may be able to suggest alternative ways to access funds which may be more beneficial for you.
In all cases, your advisor will make a recommendation only. You make the final decision and instruct your advisor as to what suits you best.
A free early access review is designed to answer this question for you before you decide whether or not to proceed so if you are undecided it is the best place to get the information you need specific to your financial situation.
No, in most cases there is no cost to access your pension early.
Any remaining funds after your withdrawal are reinvested to take at a later date.
Your advisor receives a commission from your pension provider for providing this service so you are not charged.
If you decide to access the majority of your fund or all of it there may be a fee. If a fee is applicable
Our broker partners offer free no obligation early pension access reviews.
During your review, your advisor will provide a list of the options open to you in relation to early pension access.
There is never a charge for providing you with your options and you can cancel your review at any time for any reason.
It depends on whether or not your pension provider can facilitate the transfer of your funds directly for you. Some providers can, others cannot.
If you are accessing your full pension, it is probably worthwhile checking with your provider directly first. You can note our website details and come back if they are unable to facilitate early access for you.
If you plan to access just a portion of your pension then dealing with an independent financial advisor is often best.
If you deal directly with your provider they will only offer their own products for the remaining funds you have decided to leave in your pension. They don't complete a fair analysis of the market.
However if you deal with an independent financial advisor they will search several providers such as Zurich, Aviva, Royal London, Irish Life etc. This ensures you get access to the best performing products on the market.
As pension providers now have to compete with other providers to win your business you will usually secure lower charges and fees in addition to more varied investment options. A win win for you.
It is free to get your options from an independent financial advisor so it is always worthwhile checking.
If your advisor cannot beat the service offered by your existing provider, simply close your free review and proceed with your pension provider.
Reviewing Your Options
If you are interested in finding out more about early pension access then a free early pension access review is the next step. A free review allows you to get your options verified by a financial advisor so you can weigh up the pros and cons and see if early pension access is right for you.
If eligible you will be given the option to request a free review.
Your advisor will ask you to sign a form online giving them permission to request pension details from your provider.
They will explain each option in detail.
If proceeding your advisor will process your early access for you. If not, your advisor will simply close the review.
Section 2:
Can I Access My Private Pension Early?
Withdraw Pension Early
Access PRSA Early From 50
In most cases, PRSA access is only available for those aged 60 or over.
However, a PRSA or Personal Retirement Savings Account can be accessed from age 50 in certain circumstances.
If an employer made at least one contribution to your personal pension you may be able to access your fund early from 50.
Age 60 is often a benchmark used by those who don't fully understand the rules of early PRSA access. For example online forums etc.
"Under personal retirement savings account arrangements, early retirement from an employment is possible from age 50.
Under personal pension arrangements, retirement benefits can be taken from age 60."
The above is taken directly from the Pension Authority's website.
In layman terms if an employer has made a contribution to your PRSA, access is possible from age 50.
If you have read an article online which states access to a PRSA is only available from 60, it would probably be wise to disregard the article in full as it demonstrates a lack of knowledge around the subject of early pension access and PRSA's.
In most cases PRSA access is available to those age 60 or over. However if an employer has made one or more contributions to your PRSA, you may be able to access your fund from 50.
In some cases an employer who did not offer their own pension scheme may pay into your PRSA for you instead.
If you owned a limited company and the limited company (the employer) paid into your PRSA on your behalf then you may be entitled to access your PRSA early.
If you are unsure you can have your eligibility checked by a financial advisor for free. Simply request a free review.
No. In order to access your personal pension early, you must not be an active member.
This means you cannot pay into a personal pension while you are trying to access it.
Yes, to access a PRSA early from 50 you must be out of work.
You can return to work after you have received your funds.
If you are 60 or over there is no requirement for you to stop working.
You decide how much you would like to withdraw.
You can withdraw your pension in full or partially. Its up to you.
Yes. Regardless of when you access your pension, you are entitled to take a 25% tax free lump sum from the fund subject to a lifetime limit of €200,000.
In some cases you may be entitled to take more than 25% tax free. Your financial advisor will run a number of calculations on your fund to determine the highest tax free amount available to you.
If there has been at least one employers contribution made to your PRSA and you are out of work at present, it is likely you will able to access your pension lump sum at 50.
If you withdraw any amount over your tax free entitlement, you will be taxed on the funds taken as if it were income.
So, if your income (including your pension withdrawal) in the tax year you withdraw your fund is below €40,000, you will be taxed at the standard rate of tax at 20%.
If you go over the standard rate threshold of €40,000, you will be taxed at 40%.
Your financial advisor will provide an indication of your tax liability prior to withdrawal.
This enables you to plan your early pension withdrawal tax efficiently.
If you have some room in the standard tax bracket, you may plan two withdrawals over two tax years to reduce your tax liability. Your financial advisor will work with you to limit your tax liability where possible,
This answer to this question is... it depends on your individual situation.
However, your financial advisor will be able to give you a clear recommendation based on your individual needs.
They will check your existing pension provision and advise on whether or not early access makes financial sense for you.
They may be able to suggest alternative ways to access funds which may be more beneficial for you.
In all cases, your advisor will make a recommendation only. You make the final decision and instruct your advisor as to what suits you best.
A free early access review is designed to answer this question for you before you decide whether or not to proceed so if you are undecided it is the best place to get the information you need specific to your financial situation.
No, in most cases there is no cost to access your pension early.
Any remaining funds after your withdrawal are reinvested to take at a later date.
Your advisor receives a commission from your pension provider for providing this service so you are not charged.
If you decide to access the majority of your fund or all of it there may be a fee. If a fee is applicable it will be provided to you in writing along with your options. This allows you to take this into account when considering your options.
Our broker partners offer free no obligation early pension access reviews.
During your review, your advisor will provide a list of the options open to you in relation to early pension access.
There is never a charge for providing you with your options and you can cancel your review at any time for any reason.
It is likely you can withdraw your PRSA early with your pension provider directly.
If you are accessing your full fund at once then speaking with a financial advisor is not as important.
However if you intend to access some of your fund and reinvest the remainder it is important to note that when you deal directly with a provider, they are offering you their products only.
So, if you reinvest or choose to buy an annuity, the recommendation they make will not be based on a fair analysis of the market.
An independent advisor compares products from several providers and will recommend the best product for you after a fair analysis of the market. In most cases, more competition equals a better deal for you.
So even in cases where you don't have to speak to an independent advisor to achieve your goal, it is nearly always worthwhile doing so as you are likely to receive better value pension products.
It is free so you would be pretty silly not to see if a better deal is available for you. If not, simply close your free review and proceed directly with your provider.
Yes, a free early pension access review allows you to get all the options open to you prepared by a financial advisor for free. Click here to see how a free review works.
Section 3:
Can I Withdraw my Personal Retirement Bond Early?
Cashing in Pension at 50
Can I cash in a Personal Retirement Bond Early?
A Personal Retirement Bons is a pension scheme which is normally used to move your funds away from an old employer scheme.
Once your funds are transferred to a personal retirement bond, you take control. You decide with the help of an experienced advisor how to invest your funds.
Transferring your fund from an old employers pension scheme to a PRB also removes the retirement age restriction on your pension and can enable you to access the fund earlier from 50.
Yes, you can access funds held in a Personal Retirement Bond also known as a PRB from age 50.
No, you can access your PRB and continue to work as normal.
It is up to you. You can take as much or as little as you want from your PRB if access is available.
It makes sense to discuss how much you should withdraw with an advisor as they can give you an indication of your tax liability. This will help make the decision easier.
Yes. You can take a 25% tax free lump sum from your PRB. This is subject to a maximum lifetime tax free limit of €200,000 from all your pension funds.
Yes. If you hold a PRB, once your turn 50 you will be able to access your tax pension lump sum.
If you withdraw any amount over your tax free entitlement, you will be taxed on the funds taken as if it were income.
So, if your income (including your pension withdrawal) in the tax year you withdraw your fund is below €40,000, you will be taxed at the standard rate of tax at 20%.
If you go over the standard rate threshold of €40,000, you will be taxed at 40%.
Your financial advisor will provide an indication of your tax liability prior to withdrawal.
This enables you to plan your early pension withdrawal tax efficiently.
If you have some room in the standard tax bracket, you may plan two withdrawals over two tax years to reduce your tax liability. Your financial advisor will work with you to limit your tax liability where possible,
It will depend on your financial situation.
Speaking to a financial advisor will help you to weigh up the pros and cons to accessing your pension early based on your individual situation.
In some cases accessing your fund early can be a good financial move.
No, in most cases there is no cost to access your pension early.
Any remaining funds after your withdrawal are reinvested to take at a later date.
Your advisor receives a commission from your pension provider for providing this service so you are not charged.
If you decide to access the majority of your fund or all of it there may be a fee. If a fee is applicable it will be provided to you in writing along with your options. This allows you to take this into account when considering your options.
Our broker partners offer free no obligation early pension access reviews.
During your review, your advisor will provide a list of the options open to you in relation to early pension access.
There is never a charge for providing you with your options and you can cancel your review at any time for any reason.
If you plan to access your full fund, it is likely that you can deal with your pension provider directly.
If you plan to access a portion of your fund then speaking to an independent financial advisor makes sense.
If you deal directly with your provider they will offer just their products to you for the remainder of your pension funds after your withdrawal.
If you use an independent advisor they will search several providers for you. This often results in you receiving a better deal through lower fees and charges as the pension providers have to compete for your business.
Yes, a free early pension access review allows you to get all the options open to you prepared by a financial advisor for free. Click here to see how a free review works.
Section 4:
Accessing Defined Benefit (DB) Pension Early
Cashing in Pension at 50 Ireland
Accessing DB Pension Early
Before we discuss the options which may be available to you in relation to early access it is important to first look at why defined benefit pensions are so valuable.
There are two types of employer pensions.
The first is a defined contribution scheme. With a defined contribution pension, the amount you receive in retirement is based on the investment performance of the fund. You have no guarantee how the funds will perform over time and therefore can only guestimate your retirement income.
If your fund performs poorly you could end up with a less than satisfactory pension fund at retirement.
With a defined benefit pension such as yours things work a little differently. Your employer has stated the amount you will receive at retirement. The amount you receive is not based on fund performance, it is fixed. This means there is little risk.
However there is still some risk involved as defined benefit schemes may become underfunded. If this happens the benefit you receive may be reduced.
Dealing with a financial advisor who has experience with defined benefit funds is essential. They know what to look out for and can transfer your fund to a personal retirement bond if underfunding is a concern for you.
Defined benefit schemes are no longer the norm with defined contribution plans now the most common scheme offered by employers.
Now lets take a look at how early access works with defined benefit pensions.
Yes, you can access funds in a defined benefit pension once you are over 50 and no longer work for the same employer.
No, there is no requirement for you to be out of work while accessing a defined benefit pension.
You can take any amount you wish from your fund once access is possible. It is wise to consider the tax implications first before deciding on your withdrawal amount.
If you decide to access a defined benefit pension early you are offered a transfer value by your pension provider.
This value will be calculated by your provider and will reflect the years of growth lost by accessing your fund early.
Your transfer value can be healthy or it could offer poor value for money.
A financial advisor will be able to estimate the loss of growth which applies in your particular situation and provide a recommendation on whether or not the transfer value makes financial sense for you.
This is why dealing with an experienced advisor is imperative.
Yes. You can take a 25% tax free lump sum from your defined benefit pension.
This is subject to a maximum lifetime tax free limit of €200,000 from all your pension funds.
You may be entitled to receive a higher tax free lump sum if this is the case you advisor will tell you.
Yes. If you hold a defined benefit pension, once it is transferred to a personal retirement bond you will be able to access your tax pension lump sum from 50.
If you withdraw any amount over your tax free entitlement, you will be taxed on the funds taken as if it were income.
So, if your income (including your pension withdrawal) in the tax year you withdraw your fund is below €40,000, you will be taxed at the standard rate of tax at 20%.
If you go over the standard rate threshold of €40,000, you will be taxed at 40%.
Your financial advisor will provide an indication of your tax liability prior to withdrawal.
This enables you to plan your early pension withdrawal tax efficiently.
If you have some room in the standard tax bracket, you may plan two withdrawals over two tax years to reduce your tax liability. Your financial advisor will work with you to limit your tax liability where possible,
It will depend on your financial situation and the transfer value offered by your provider.
Speaking to a financial advisor will help you to weigh up the pros and cons to accessing your pension early based on your individual situation.
In some cases accessing your fund early can be a good financial move, in others there may be a more beneficial way for you to access additional funds. Your financial advisor will be able to offer assistance in this area.
No, in most cases there is no cost to access your pension early.
Any remaining funds after your withdrawal are reinvested to take at a later date.
Your advisor receives a commission from your pension provider for providing this service so you are not charged.
If you decide to access the majority of your fund or all of it there may be a fee. If a fee is applicable it will be provided to you in writing along with your options. This allows you to take any fee into account when considering your options.
Our broker partners offer free no obligation early pension access reviews.
During your review, your advisor will provide a list of the options open to you in relation to early pension access.
There is never a charge for providing you with your options and you can cancel your review at any time for any reason.
In many cases your pension provider will not be able to facilitate the transfer of your defined benefit pension into a PRB so you can access the fund early.
However, if you intend to access the entire fund it might be worthwhile contacting them directly to see if they can facilitate access for you. If you decide to do this, you should be confident that you can ascertain the transfer value offered is fair. As once you accept the transfer value their is no turning back.
You can note our website details and come back if they are unable to facilitate the transfer for you or you are unsure if the transfer value offered is fair.
If you intend on accessing a part of your pension for example your tax free lump sum, speaking to an independent financial advisor will be extremely beneficial.
If you deal directly with your pension provider when reinvesting your funds they will offer you their own products only. This means the pension products you are offered will not be based on a fair analysis of the market.
If you speak with an independent financial advisor they will make a recommendation based on pension products available from several different providers such as Zurich, Aviva, Irish Life etc.
When pension providers have to compete with other providers for your business it often leads to reduced fees and charges.
It is free to get your options prepared by an independent financial advisor so it is always worthwhile checking to see if you can obtain a better deal.
Yes, a free early pension access review allows you to get all the options open to you prepared by a financial advisor for free. Click here to see how a free review works.