Can You unlock Your Pension Early ?

I am a deferred/former member of an Occupational Pension Scheme- can I unlock my pension benefits?

In June 2016, The Minister for Finance amended the legislation governing occupational pension schemes and extended the access of more flexible retirement options to members & former members of occupational pension schemes. This means the Approved Retirement Fund, more commonly known as the ARF option has been applied to all individuals with Personal Retirement Bonds/Buy out Bonds.

What does the Approved Retirement Fund (ARF) option mean?

If you have already transferred out of a previous defined benefit pension scheme, or you are currently considering taking a transfer value, you will have increased options on how you can draw down these benefits. You will have both

  • the option of taking your benefits based on your years’ service and final salary
  • or the new ARF option which allows you to take 25% of the fund as tax free cash and reinvest the balance subject to certain restrictions.

What does the Introduction of this new option mean for former members of defined benefit Schemes?

The introduction of these new flexible options means that former members of occupational pension schemes can

  • Access their benefits from age 50 onwards (provided the previous scheme rules allowed or were amended to allow this option)
  • Take 25% of the value of the accumulated fund as tax free cash (up to a lifetime limit of €200K) & then transfer the residual amount to an Approved Minimum Retirement Fund & Approved Retirement Fund (see AMRF/ARF).