When retiring from a company pension structure, you have 2 tax free lump sum options. One is to take 25% of your fund tax free. The other is to take 1.5 times your final salary (average of best 3 consecutive salaries over the last 10 years). If you opt for the second option, you must buy an annuity with the remainder of your fund, ie the ARF option is no longer available to you.
With an annuity, you effectively use your fund to buy a pension for the rest of your life.
For example, if you have a fund of €300,000 and you opt for a Single Life Annuity of 5.4%, the life insurance company will pay you €16,400 per year for the rest of your living years. (This example is for illustration purposes only…Talk to us about different rates available today)
Benefits of Annuity:
- For budgeting purposes, you know exactly how much income you will have for the remainder of your life.
- You are not confined to a single life annuity.
- If you are married, you can opt for a joint life annuity, passing the benefit over to your spouse, at an actuarially adjusted lower rate.
- If you are in poor health, you can opt for an impaired life annuity, at an actuarially adjusted higher rate.








