Self-employed pensions

Self-employed pensions are designed for individuals who work for themselves. As a self-employed individual, it is essential for you to think about retirement and plan for the future.

Because you’re not an employee, you can’t benefit from an occupational pension. However, in Ireland, when you’re self-employed and pay your own PRSI at 4%, you can potentially receive the State pension once you retire. 

However, €12,912 might not be enough to live on at retirement. That’s why you need to open your mind to other options and look into personal pensions.  

Sole Trader Pension

If you’re a sole trader, you may feel like you’re not suitable for a pension because your income varies and can go up or down every month. Or you may rely on your business to sustain your needs at retirement. Indeed, many self-employed people plan to continue working into their late 60s and 70s and plan to supplement the State Pension this way.

But think about it, if you work for yourself, you most definitely work hard and maybe harder than the average person. So, scaling back your work in your 60s and 70s would be a fantastic idea. And the best solution is to invest in a private pension every month, and then use this money to replace your income once you retire. 

Reasons for building your own pension fund:

  • Income tax relief each year, because of your contributions.
  • The State Pension may be a much lower income than you’re used to.
  • Unexpected ill-health might affect your ability to keep working in your 60s & 70s.
  • Taking a tax-free lump sum from your pension can allow you to pay off last-minute debts or mortgages if you plan to scale back your work & reduce your income. 

It’s never too late to start building your pension fund. It’s one of the best ways to save money and potentially let your money grow over time. If you need more reasons to start a pension, look here.

Pensions for self-employed people: 

  • Retirement Annuity Contracts – RACs, which are also known as Personal Pension Plans, etc.
  • Personal Retirement Savings Accounts – PRSAs

These two types of pensions will allow you to get income tax relief on your pension contributions. Moreover, you will have the same choices of what to do with your fund once you retire. You should also know that those self-employed pension options will give you more freedom with what to do with your money than other types of pension plans.  

WHERE TO START?

Speak to Greenway Financial Advisors, call 01 853 2727 to talk directly with us. We can help find the best pension option, within your budget. Plus, as experts in the field, we will advise you on a suitable product that will help you grow your fund.

Get a free 15 consultation with a financial advisor here

Best of all, we work with you long-term: 

  • Your business will grow and change – we can help you decide when to increase your yearly contribution. 
  • We’ll help you to monitor your pension over time, and switch funds if you need to.
  • We’re also able to remind you when your Tax Relief percentage increases as you get older, to maximize your relief. 

 

Greenway Financial Advisors Limited is regulated by the Central Bank of Ireland. Registered No. C168372

Debbie Cheevers

Debbie Cheevers

Qualified Financial Advisor

Debbie was born in Dublin and graduated from NCAD with a degree in Visual Communication. She brings a strong customer services background to Greenway.

Debbie qualified as APA in 2017 and a fully qualified financial advisor (QFA) in 2018.

She believes that product knowledge is key to helping customers make the right choices.