The 2020 general election is just days away and one of the key hot button issues is Retirement Age and the State Pension.
Under the Pensions Framework, 2010, the then Brian Cowan Government agreed to implement increases in the State Pension Age in order to comply with Troika recommendations. The Social Welfare and Pensions Act, 2011 giving effect to those changes was introduced by the new Fine Gael government.
In 2014, the State Pension, Transition, payable for one year at age 65 was abolished and the commencement age for the State Pension was set at 66. This left thousands who were contractually obligated to retire at 65 needing to sign onto Job Seekers Benefits to bridge the gap. The pension age is set to increase to 67 in 2021 and 68 in 2028 under the 2011 Act.
In spite of the increase in the pension age, many politicians remain exempt from the changes. TDs and Ministers who were public servants before 2004 are entitled to retire at 50, while those who came into office later can access their pension at 65.
Only those who entered public service after 2013 will have to wait for as long as most ordinary workers for their pension payments to kick in. And now, even they can choose to draw their pension when they turn 65.
The gap between private and public sector pensions is widening even further.
There is no doubt that General Election 2020 may have an immediate measurable effect on your State Pension. There are a number of options available to mitigate this risk:
- Challenge candidates when canvassing as to how they plan to help retirees until their State Pension kicks in.
- Keep informed by tuning in and listening to the various political broadcasts on television and radio.
- Vote
- Consider contributing to a private pension – this will help to reduce the risk of an income gap at retirement.
To discuss setting up a private pension; for advice on your future retirement planning or for more information on self-administered pensions, please contact Adelphi Financial Brokers.