There’s no definitive answer to this as it all depends on the individual and what their goals are when they retire. If you want to continue living a fairly normal lifestyle you will require a much smaller fund than someone who wants to jet off around the world. If you, as an individual, qualify for the state pension you will receive approximately €1,075 per month, this can vary depending on if you have a dependent spouse and  your overall PRSI contributions etc. 

If you’re working with a pension then the actual amount you need to have can be determined by your income need and then working backwards to determine the fund required to generate it.  

To do this we would use the standard figure of 4%. 

We use 4% because it represents the standard annuity rate and is also the globally accepted, sustainable rate of withdrawal from post-retirement investment funds i.e. Approved Retirement Funds (ARF) in Ireland. 

If we work with that, then each...

Pension Terminology

Risk Level – Each fund has a risk level attached to it which is a guide how risky the fund is. A higher number means a higher risk fund and a lower number means a lower risk fund. A higher risk fund will give you more potential for investment growth. The scale is generally 1 to 7.

Tax Relief – Is a tax deduction on your pension contributions. It is an incentive to encourage people to save into their pensions.

Contributions – These are the payments you pay into the pensions fund they can be made in lump sums or recurring monthly premiums.

What is a Personal Pension?

A Personal Pension is an account you can use to save for your retirement. You can make lump or recurring payments into a Personal Pension, and these are usually tax deductible. A Personal Pension can be invested into different types of funds with different risk levels (higher risk means a better chance of high returns but a higher chance of losing your money and lower risk means lower...