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Why start a pension now

Starting a pension may not be on top of your to do list, but with the State pension unlikely to increase in the future, are you confident you’ll have enough in retirement?

Starting early makes sense

If you start a pension early, your money has more time to grow which could give you a higher income in retirement.

You could also benefit from more tax relief than someone who starts later.

Age 25 Retiring in 40 years Age 35 Retiring in 30 years Age 45 Retiring in 20 years
Age 25 Retiring in 40 years Age 35 Retiring in 30 years Age 45 Retiring in 20 years
If you saved €250 per month, by claiming tax relief, the real cost to you is €150 as the taxman contributes:
€48,000 €36,000 €24,000
When retiring at age 65, your pension pot would be worth:
€245,200 €150,500 €82,900
This could provide you with a yearly income of:
€9,000 €5,700 €3,300

These figures are for illustration only to demonstrate potential investment growth, and the pension income you might get when you retire. We've made some assumptions: you claim tax relief at 40% on your contributions and that you retire at 65. We've assumed that your investments will grow at 5% per annum.

The effects of inflation have not been included in these figures. Inflation affects your purchasing power in the future. These figures assume that no cash lump sum is taken from your pension pot when you retire. Taking a cash lump sum will reduce the value of the pension income. The value of your investment may go down as well as up.

Increase your contributions

If you’re already contributing to a pension, consider increasing your contributions regularly. Putting more money into your pension each year could make a big difference to your final pension pot.

Most pensions are flexible so you can pay in a lump sum and you can stop, start, increase or reduce your contributions at any time.

You can also choose investments for your contributions which match your attitude to risk.

Try our Risk questionnaire and find about your risk profile.

Warning: These figures are estimates only. They are not a reliable guide to the future performance of your investment