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What happens with the pension... I don't want to lose what I have paid in?

18/04/2020 Posted by IAPF | Comments(0)

Question:  I have worked in the hospitality sector for the same employer for the last nine years and have just been laid off because of Covid-19. I am so worried about the health of my family in the short term and our long-term financial security. My colleagues and I all pay 5pc of our monthly salary into the company pension scheme, and our employer pays the same. We all hope to go back to work in a few weeks' time and I am wondering what happens with the pension as I don't want to lose what I have paid in.

Answer: Whatever decisions you make now, the money you have paid in, the money your employer has paid, plus any growth, is yours.

Additionally, your rights to that fund are secured by law regardless of how long you are not working and regardless of whether you go back working with that employer or move somewhere else, according to CEO of the Irish Association of Pension Funds Jerry Moriarty.

He suggests that you speak with the trustees of the pension scheme to see what options are there while you are not working.

Even if your contributions cease while you are not working, it is important that they restart as soon as you return to work, Mr Moriarty added. Pension saving is all about habit. People that break the savings habit often do so for many years and live to regret it when they reach retirement.

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