A Personal Retirement Bond (sometimes called a Buyout Bond) is a pension account you can use to transfer out pensions from old jobs. You keep all the tax benefits of a pension, but cut the link with your old employer.
Using a Pensions Retirement Bond means you are fully in control of investment choices, get transparent pricing and ongoing information, and can receive ongoing financial advice on your pension.
It’s easy to lose track of old pensions if you leave your job without taking your pension with you.
What’s more, it can be hard to get regular information on its performance, or to make changes to it. That’s why many people choose to move their pension money at the same time as they leave a job.
When you leave your job, you’ll typically receive a Leaving Service Options Letter (also called a Pensions Transfer Letter and similar names). As the name suggests, this letter will include a form giving you several choices to deal with your pension, and one of these will be to move it to a Personal Retirement Bond/ Buyout Bond.
Why would I want a Personal Retirement Bond?
Personal Retirement Bonds have three big advantages for pension savers:
- Control and transparency: once you’ve left an old employer, your ability to direct your pension money can be very limited. It’s often hard to get clarity on where your pension is invested, to make changes to it, or to receive advice on it. A PRB solves all these problems.
- Access: unlike most pensions in Ireland, a PRB can be accessed from age 50. If retiring early is a priority, or you have good use for a lump sum, this is a smart way to do it. On the other side of the coin, you can keep your money in its tax-free PRB wrapper until age 70 if you wish, even if your old company retirement date is later.
- Flexibility: by keeping pensions from your old jobs separate from your new one, you increase your options for income in retirement. For example, you could access one pension pot in your early fifties, another (say your main pension fund) when you actually retire from the workforce, and others in your 70s.
You can read more about the advantages and disadvantages of PRBs here.
Keen to get a grip on pensions from jobs you have left? We’d love to help. You can get in touch using the form below.
It’s never too late!
It’s also possible to take control over pensions from jobs you left many years ago. With a handful of reference points, we can help you track down your old pensions and get them back into shape.
The pension administrators can supply a fresh Leaving Service Options Letter, and we can help you consider if it is worth moving into a Personal Retirement Bond.