Pensions · Accessing Your Pension
Accessing Your Pension in Retirement
If you’re approaching retirement, or already there, the big question changes from “how do I save?” to “how do I draw it down safely?” We’ll walk you through your lump sum, ARF and annuity options so you have a clear, tax-efficient plan for the next 25 to 30 years.
Last reviewed by Debbie Cheevers, QFA, RPA · 30 June 2026
Planning your income in retirement
The retirement income question
When you stop working, your pension pot needs to do something it has never done before: pay you a wage for the next 20 to 30 years. The decisions you make in the 12 months either side of retirement will shape how comfortable, and how tax-efficient, that income is.
There are four main building blocks: a tax-free lump sum, an Approved Retirement Fund (ARF), an annuity, and any State Pension entitlement. Most clients end up using a blend.
The key choices
- Lump sum — how much to take tax-free, and what to do with the balance above the tax-free limit.
- ARF vs Annuity — flexibility and growth potential, or a guaranteed income for life.
- Drawdown rate — how much to take each year so the pot lasts.
- Tax bands — sequencing income to stay below the higher-rate threshold where possible.
The four post-retirement products explained
Cash lump sum
At retirement you can usually take up to 25% of your pension as a lump sum. The first €200,000 is tax-free; the next €300,000 is taxed at 20% (the Standard Fund Threshold rules apply). For many clients this is the first decision — and getting the figure right matters because it shapes everything that follows.
We’ll model how different lump-sum amounts affect your ongoing income, your tax position, and what’s left invested.
Approved Retirement Fund (ARF)
An ARF keeps the balance of your pension invested after retirement, and you draw a flexible income from it. You stay in control, choose your investment funds with us, and pass any remaining value to your spouse or estate. Revenue requires a minimum imputed drawdown (currently 4% from age 61, 5% from 71).
ARFs suit clients who want flexibility, growth potential and to leave something behind — but income isn’t guaranteed for life.
Annuity
An annuity converts part or all of your pension into a guaranteed income for life. It’s predictable, simple, and removes investment risk — useful if you want a fixed floor under your essential spending. You can add spouse’s pensions, indexation and guaranteed periods.
We compare annuity rates across the Irish market because rates can vary materially between providers on the same day.
Planning income in retirement
The real work is putting the pieces together: which pots to draw first, how to use the lump sum, how to layer State Pension on top, and how to keep your tax bill efficient year after year.
We build a written retirement income plan you can actually follow — reviewed annually so it stays aligned with your spending, the markets and tax changes.
Have a pre-retirement meeting before you make the call
Most ARF, annuity and lump-sum decisions can’t be unwound. A short conversation now can save tens of thousands across retirement.
Helpful if you’re 5 years out, or already at retirement
Approaching retirement (55–64)
You have one or more pensions and you want to know what they actually deliver, when to retire each pot, and how to structure income tax-efficiently from day one.
At retirement (65 or thereabouts)
You need to make the live decisions: take a lump sum, set up an ARF, buy an annuity, or a mix. We model real numbers, not generic illustrations.
Already retired
You’re in drawdown and want a second opinion on your ARF investment strategy, drawdown rate, charges and tax position. We can review and consolidate.
How a retirement income plan comes together
1. Stock-take
We gather every pension, PRSA, AVC, State Pension entitlement and other income source so you can see the full picture on one page.
2. Income target
We work out what you actually need to live on — essentials, lifestyle and one-offs — in today’s money and inflation-adjusted.
3. Model the options
Lump sum size, ARF drawdown, annuity rates, tax bands. We show side-by-side scenarios so the trade-offs are obvious.
4. Implement & review
We put the plan in place across the right providers and meet annually to keep it on track as markets, tax and your spending change.
Common questions about retirement income
Should I take an ARF or an annuity?
It depends on how much guaranteed income you need, your appetite for investment risk, and whether you want to leave a balance to family. Many clients use a blend — an annuity to cover the bills, and an ARF for flexibility and growth. We model both side-by-side using your real numbers.
How much tax-free cash can I take?
You can typically take up to 25% of your pension as a lump sum, with the first €200,000 tax-free and the next €300,000 taxed at 20%. There are alternative “salary and service” calculations for occupational schemes that sometimes produce a better result — we’ll check both.
How much can I safely draw from an ARF?
Revenue’s imputed minimum is 4% a year from age 61 (rising to 5% at 71). Sustainable rates depend on your investment mix, charges and how long the pot needs to last — we generally model 3.5%–5% for long retirements and stress-test against poor early-year returns.
When should I start planning?
Ideally 3–5 years before your intended retirement date. That gives time to align your investment risk to the drawdown phase, organise AVCs if useful, and avoid rushed decisions in the final 12 months.
Will my spouse be looked after if I die?
Yes, but the mechanism differs by product. ARFs pass on to your spouse tax-efficiently. Annuities can include a spouse’s pension if you select it at outset (it costs a little more, but is usually worth it). We make sure this is built into the plan.
What does advice cost?
Initial consultations are free and obligation-free. Implementation is paid via standard provider commission or a clear fee — disclosed in writing before anything is set up.
Let’s plan your income in retirement
A 30-minute conversation. No obligation. Clear next steps.
Warning: The value of your investment may go down as well as up. Past performance is not a reliable guide to future performance. The income from a pension may go down as well as up and any tax-free amount or treatment depends on individual circumstances and may change. If you invest in this product you may lose some or all of the money you invest. Greenway Financial Advisors Ltd t/a Greenway Financial Advisors is regulated by the Central Bank of Ireland.