slide1
Download
Skip this Video
Download Presentation
Presentation to Presented by:- Noel Hackett (QFA, MIB, Dip Invest) New Ireland Assurance Senior Pensions Consultant Tel: 086-8186163

Loading in 2 Seconds...

play fullscreen
1 / 42

Benefits at Retirement - PowerPoint PPT Presentation


  • 119 Views
  • Uploaded on

Presentation to Presented by:- Noel Hackett (QFA, MIB, Dip Invest) New Ireland Assurance Senior Pensions Consultant Tel: 086-8186163 Tony Delaney- Area Sales Manager New Ireland 12-13 APRIL 2011 . Benefits at Retirement. At retirement your benefits will come from:- State Pension

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Benefits at Retirement' - keanu


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
slide1

Presentation to

Presented by:-

Noel Hackett (QFA, MIB, Dip Invest)

New Ireland Assurance Senior Pensions Consultant Tel: 086-8186163

Tony Delaney- Area Sales Manager

New Ireland

12-13 APRIL 2011

benefits at retirement
Benefits at Retirement
  • At retirement your benefits will come from:-
    • State Pension
    • NUIG Scheme
    • Personal Wealth / Savings
state pension
State Pension
  • From 2011
    • Single Person €230.30 per week
    • Married Couple €383.80
  • Applies to all employees who joined since 1995
nuig scheme
NUIG Scheme
  • Defined Benefit Basis
  • For employees joining after 1995 :-
    • Pension Benefits based on Pensionable Salary
    • Salary less twice the OAP (In 2010 a deduction of €23,951)
    • Employees pay PRSI and qualify for OAP
nuig scheme1
NUIG Scheme
  • Normal Retirement Date
    • Pre 2004 employees – From age 60
    • Post 2004 employees – From age 65
  • 1/200th pensionable service/pensionable remuneration to 3.33 times State Pension (39,918)

Plus

  • 1/80th x pensionable service/pensionable remuneration in excess of this limit(change to normal integration rules on 1/1/2004)
  • Pension of 1/80th of Pensionable Salary per year of service, on integrated basis(less twice state) same for salary over €39,918pa
  • Tax Free Lump Sum of 3/80th of Salary
example
Example
  • Employee on a salary of €50,000 joined NUIG in 2000 at age 30
  • Service to age 65 is 35 years
  • Pensionable Salary is €26,049(€50,000 - €23,951)
  • Pension from 65 is 35/80ths of €26,049 – €11,396 p.a.
  • Tax Free Lump Sum is 105/80ths of €50,000 - €65,625
early retirement
Early Retirement
  • Was allowed but only as a deferred pension
  • Changes from 2004
    • Existing employees from 50
    • New entrants from 55
    • Immediate pension payable
    • Early payment reduction
    • Change to normal integration from 1/1/2004
bridging the gap 2 options
Bridging the Gap - 2 Options
  • Purchase of Notional Years of Service
  • AVC Scheme
notional years
Notional Years
  • Employee can buy “notional years”
  • Defined Benefit basis
  • Must buy year with all the “trimmings”
scope for avcs
Scope for AVCs
  • Will your benefits be on an integrated basis – i.e. joined after 1995 ?
  • Do you
    • Wish to retire early ?
    • Have short service ?
    • Want to provide a higher Spouses Pension
avc scheme
AVC Scheme
  • No promised benefits – will depend on
    • Investment Returns
    • Annuity Rates – if pension bought at retirement
  • Can be more flexible than added years
    • Select a monthly contribution
    • Save for a specific benefit
    • ARF option
    • Lump Sum only
additional voluntary contributions
Additional Voluntary Contributions
  • Government incentive through:-
    • Tax Relief
    • Generous contribution limits
    • ARF option – greater flexibility at retirement
slide14

USC for self assessed under age 70 the 2011 ratesPart of aggregate income Rate of USCFirst €10,030 2%Next €5,980 4%Next €83,984+ 7%Income > €100,000 10%

tax credits
TAX CREDITS

2010 2011

€ €

Employee Tax credit 1,830 1,650

Personal tax credit-single 1,830 1,650

-married 3,660 3,300

Widowed bereaved in yr of ass. 3,660 3,300

One parent family tax credit 1,830 1,650

Home carer tax credit 900 810

Dependant relative 80 70

Blind person credit-single 1,830 1,650

both blind -married 3,660 3,300

Additional credit widowed pers 600 540

Age credit-single 325 245

Age credit married 650 650

standard rate bands
Standard Rate Bands

2010 2011

€ €

Single/Widowed 36,400 32,800

Married-one income 45,400 41,800

*Married-two incomes 72,800 66,500

One parent/Widowed 40,400 36,800

  • With a max transferability between spouses of €45,400 in 2010 and €41,800 in 2011
  • AGE EXEMPTION LIMIT

2010 2011

Single €20,000 €18,000

Married €40,000 €36,000

pension levy rates
PENSION LEVY RATES:
  • First €15,000 Exempt
  • Next €5,000 @5%
  • Next €20,000- €60,000 @10%
  • Above €60,000 @10.5%
early retirement benefits
Early Retirement Benefits

Retirement Age 60

  • Employee on salary of €50,000 joined after 1995 - early retiring at 55
  • Service completed 22 years
  • Pension : 77.8% x 22/ 80ths x€26,049= €5,573
  • Tax Free Lump Sum : 90.7%x 66/80ths x €50,000 = €37,414
slide19

NUI Galway AVC contributions

V`sOrdinary Deposit Savings

Saving €1,000 pa/Interest rate of 3% pa/

DIRT 25%/term 20 Yrs

Value in Savings A/c €24,450.10

Value in AVC Fund €40,961.12

slide20

NUI Galway AVC contributions

V`sOrdinary Deposit Savings

Saving €1,000 pa/Interest rate of 3% pa/

DIRT 25%/term 10 Yrs

Value in Savings A/c €11,324.88

Value in AVC Fund €17,475.50

N.B. : to save €1,000 you would need to earn €1,300 gross. Tax on tax.

slide21

Actual AVC Member – Example

Mary Murphy Retired in April 2010.

29yrs service. Age 65. Salary €59,000

NUIG Pension €12,705.38p.a.

NUIG Tax free lump sum €64,162.50

AVC Fund built up in 5 yrs @ €300pm = €21,075.30

TAX free lump sum from AVC is €21,075.30

Could have been €24,337.50 from AVC if it was in her fund.

how much can i contribute1
How much can I contribute ?
  • Maximum Income in 2011 €115,000
  • (Max income in 2009/10 €150,000)

(max income 2008 €275,239)

  • Income is taxable earnings
  • Less any contributions being paid to NUIG Scheme
example1
Example
  • Employee aged 45 on a salary of €60,000 who joined post 1995
  • Maximum contribution is:-

25% of €60,000 €15,000

Less 1.5% of €60,000 € 900

Less 3.5% of €60,000 - €23,951 €1,262

AVC amount is €12,838

  • Periodic contributions of pay equal to 1.5% xpensionable remuneration PLUS 1% of reckonable pay at death/retirement (each year 1.5% not deducted)
tax relief
Tax Relief
  • Monthly Contribution €200.00
  • Tax Relief €40.00 €82.00
  • Net Cost €144.00 €102.00
  • Lump sum can be made to AVC before 31st October 2011 and tax rebate cheque and PRSI relief will be granted.
  • Contributions and tax relief operated at source
investment of contributions
Investment of Contributions
  • Individual Retirement Investment Service
  • Plus 13 alternative pension choices
individual retirement investment service
Individual Retirement Investment Service
  • New Ireland’s unique lifestyle investment option
  • A single fund can’t provide the right strategy for all members
  • Removes the need for the member to make complex investment decisions
how does iris work
How does IRIS Work ?

Two Simple Rules

  • The longer the term to retirement, the higher the proportion invested in equities.
  • As retirement approaches, benefits are secured by switching into fixed income assets and cash.
example progression of the iris fund 2018 asset split
Example –Progression of the IRIS Fund 2018 (asset split)
  • Member continues to invest in the same fund
  • Asset mix of fund gradually changes as retirement approaches
new funds added medium risk
New Funds Added: Medium Risk
  • Response to requests from Trustees and Members
  • Requirement for equity participation with lower risk / volatility
    • Protected Assets Fund
    • BNY Mellon Global Real Return Fund
protected assets fund
Protected Assets Fund
  • Growth Potential
    • 98% of fund invested in equities and cash
    • Equity / Cash allocation actively managed to minimise volatility
  • Protection
    • 2% of fund buys the guarantee
    • Fund cannot fall by more than 10% in any calendar year
    • Protection level increases during year
    • Protection reset every year on 1st of January
example2
Example
  • 01/01/2011: fund starts at 100
    • Protection is 100 x 0.9 = 90
  • 01/07/2011: fund has grown to 115
    • Protection is 115 x 0.9 = 103.5
  • 01/10/2011: fund falls back to 108
    • Protection is still 103.5
  • 01/01/2012: fund is still at 108
    • Protection for 2012 resets to 108 * 0.9 = 97.2
bny mellon global real return fund
BNY Mellon Global Real Return Fund
  • Key Features
    • Absolute Return Fund
    • Objective to achieve EURIBOR +4% over rolling 5 year period
    • Equity participation with reduced volatility
  • Based on successful track record in UK
slide35

Elements & BNY Real Return funds – successfully smoothing out the current fluctuations of the market.

Volatility management of Elements and BNY clearly providing a

smoother investment Journey for clients over a testing 3 months .

Source New Ireland

options at retirement
Options at Retirement
  • Tax Free Lump Sum
  • Ongoing Pension
    • Personal
    • Spouses
  • Approved Retirement Fund ( ARF)
    • Minimum income of €12,700
    • Free to invest as you wish
    • Withdrawals taxed as income
making it easy to track your fund
Making it easy to track your Fund

Pensions Schemes Online

  • Password protected website
  • Information on premium history
  • Information on fund value
  • Information on fund choice
  • It is easy to use
  • It is free
  • Review yearly – especially if circumstances change
new ireland website
New Ireland Website
  • www.newireland.ie

New Ireland Investment Centre

http://fundcentre.newireland.ie

  • Up to date price\performance information
  • Monthly factsheets – include asset split, fund size etc
  • Graph performance of funds
new ireland website1
New Ireland Website
  • www.newireland.ie

New Ireland Pension Centre

http://www.newireland.iepensionscentre.newireland.ie

  • Comprehensive source for all New Ireland pension material
what should i do next
Contact:

Ms Triona Lydon Pensions & Investments NUI Galway

Ph 091-524411 ext: 5028 Email : [email protected]

Or:

Noel Hackett, QFA, Pensions Consultant

New Ireland Assurance

Eyre Square, Galway

Tel 091-563023; Mobile 086-8186163 Email: [email protected]

What Should I Do Next?
individual consultations
Individual Consultations

Noel Hackett will be in NUI Galway for

Individual Consultations of 45 mins (9 a.m. – 5 p.m.)

on

Monday 18th April 2011

and

Tuesday 19th April 2011

CONTACT:

Anne Cormican Extn:5901

Caroline Flannery Pensions Office Extn 5028 to book time.

ad