Pension Transfer
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Pension Transfer As You Move Jobs
Frequently Asked Questions: Personal Retirement Bond or Irish Buyout Bonds?
What is a personal retirement bond (Buyout Bond)?
A Buyout Bond (also known as a Personal Retirement Bond) is a pension arrangement that allows you to transfer your benefits from a company pension scheme into your own personal pension policy. This typically happens when you leave employment or if your company pension scheme is being wound up.
Why would I need a Personal Retirement Bond or Buyout Bond?
You might consider a Buyout Bond if:
- You’re leaving your employer and want to take control of your pension
- Your company’s pension scheme is being wound up
- You want more control over your investment choices
- You wish to consolidate multiple pension pots
What investment options are available?
With our Buyout Bonds, you get access to a wide range of investment options including:
- World-class index funds from providers like Vanguard and BlackRock
- Active and passive investment strategies
- Multiple asset classes (equities, bonds, property)
- ESG (Environmental, Social, and Governance) focused funds
- Cash funds for more conservative investors
What are the advantages of a Buyout Bond?
- Complete control over your investment choices
- Access to competitive fund management charges
- Flexibility in retirement options
- No requirement for employer involvement
- Ability to pass on benefits to your family
- Access to professional investment managers
When can I access my Buyout Bond?
Generally, you can access your Buyout Bond:
- From age 50 if you’ve left the employment related to the original pension
- At normal retirement age (usually 60-65)
- Earlier in cases of ill health
- By age 75 at the latest
What happens to my Buyout Bond when I retire?
At retirement, you typically have several options:
- Take a tax-free lump sum (usually up to 25% of the fund)
- Purchase an annuity
- Transfer to an Approved Retirement Fund (ARF)
- Take a taxable cash sum
What happens if I die before retiring?
- The full value of your Buyout Bond will be paid to your estate
- Benefits are typically paid tax-free to your spouse/civil partner or dependents
- If paid to other beneficiaries, inheritance tax may apply
Are there any charges?
Common charges include:
- Annual management charges (varies by fund choice)
- Policy fees
- Fund switching fees (if applicable)
- Early encashment charges (if applicable)
Can I make additional contributions to my Buyout Bond?
No, a Buyout Bond or Personal Retirement Bond is a one-time transfer vehicle. You cannot make additional contributions after the initial transfer.
How are Buyout Bonds taxed?
- Growth within the fund is tax-free
- You can typically take up to 25% tax-free at retirement
- Any additional lump sum or income is taxed at your marginal rate
- Benefits paid on death before retirement are usually tax-free to dependents
- How do I monitor my investment?
- Regular statements will be provided
- Online access to view your fund value and performance
- Annual benefit statements
- Option to switch funds online or through us
Do I need financial advice?
While not mandatory, it’s highly recommended to seek professional financial advice before:
- Setting up a Buyout Bond
- Making investment choices
- Planning your retirement options
- Making any significant changes to your pension arrangements
For specific advice about your situation, please don’t hesistate to contact us with any questions you might have.
Benefits of PRB
There are various benefits to taking out a personal retirement bond. First, it saves you the awkwardness of dealing with your former bosses. In addition, you have complete autonomy and control of the fund. You will not have to subscribe to the general investment plan your employer gets the entire employees on. You can take cash out of this fund from the age of 50 if you wish to.
Take Control
Being in charge of your investment will no doubt lead to prudence. You can invest your pension fund in line with your long-term financial objectives and available fund.
Now, what is our role in this arrangement?
Firstly, we provide you with the guidance you need to take out a personal retirement bond. We have the expertise to ensure you do not make any mistakes during the process. We are also your trusted ally if you choose to invest your pension fund. We recommend the best suite or portfolio for you to invest in.
Our pricing is transparent, and we have no affiliations with any financial institution – we work for you and you alone. In addition, we employ a seamless and straightforward process. This means no hidden charges and an easy onboarding process.