Retirement Planning in Ireland: What Nobody Tells You
- Sid Hegde
- Apr 7
- 6 min read
By Sid Hegde, QFA and Financial Coach | Galway, West of Ireland
Most conversations about retirement planning in Ireland begin and end with one question: do you have a pension?
If the answer is yes, people tend to relax. Pension sorted. Move on.
But in my experience working with professionals across Galway and Ireland, having a pension and having a retirement plan are two entirely different things. And the gap between them is where most of the quiet financial stress lives.
In this blog, I want to give you an honest, grounded look at what retirement planning actually involves in the Irish context — including the things that most people do not think about until it is too late. I will also share the biggest mistakes I see, the questions worth asking right now, and why getting clear on this sooner than you think is one of the most valuable financial decisions you can make.
I should note upfront: I am a financial coach, not a financial advisor. I do not recommend specific pension products or funds — that is the role of a regulated advisor. What I do is help you build the clarity, the structure, and the decision-making framework that makes every pension conversation far more productive.
The State Pension: Your Baseline, Not Your Plan
Let us start with the State Pension — because many people assume it will do more heavy lifting in retirement than it actually can.
As of 2025, the maximum State Pension (Contributory) in Ireland is €289.30 per week, which amounts to approximately €15,000 per year. For context, the average Irish household spends considerably more than that annually.
The State Pension is an important foundation, but for most professionals, it will not sustain anything close to their current lifestyle in retirement. Treat it as a baseline, not a plan.
There have also been important changes to how the State Pension is calculated. From 2025, the yearly average method is being phased out and replaced with a Total Contributions Approach — meaning your pension will be calculated based on how many PRSI contributions you have made over your working life, with 40 years of contributions required for the maximum rate. This has significant implications for people with gaps in their contribution history — including those who took time out for childcare or career breaks.
Auto-Enrolment: A New Reality for Irish Workers
In September 2025, Ireland launched 'My Future Fund' — the new automatic enrolment retirement savings system. This is one of the most significant changes to Ireland's pension landscape in a generation.
Under the scheme, employees aged 23 to 60 who earn over €20,000 per year and are not already in a workplace pension are automatically enrolled. Contributions begin at 1.5% from employee and employer respectively, rising to 6% each by year ten, with the State contributing an additional top-up.
If you are already in an occupational pension scheme, auto-enrolment does not directly affect you — but it does signal an important cultural shift. Ireland is now serious about retirement savings in a way it has not been before.
For those who already have pensions in place, the question is no longer 'do I have a pension?' — it is 'is my pension actually enough?'
The Biggest Mistakes I See in Retirement Planning
In my coaching conversations, the same patterns come up again and again. These are the mistakes that quietly cost Irish professionals the most:
Mistake 1: Treating Your Pension as a Set-and-Forget Decision
Many people set up a pension, pick a contribution level, choose a fund (often a default), and never look at it again. Five years later, the world has changed. Their income has gone up.
Their goals have shifted. And the pension has been quietly chugging along — possibly in a fund that no longer suits their timeline or their risk profile.
A pension is not a set-and-forget product. It benefits from regular review, particularly at key life stages: salary increases, changing employers, hitting your 40s, and the decade before retirement.
Mistake 2: Not Maximising Tax Relief
One of the most underused financial tools available to Irish professionals is pension tax relief. Contributions to a pension are eligible for income tax relief at your marginal rate — which means a higher-rate taxpayer contributes €60 for every €100 that goes into their pension. The government effectively tops up the other €40.
Despite this extraordinary incentive, many people are not contributing at the level they are permitted to contribute. Age-based contribution limits range from 15% of earnings for those under 30, up to 40% for those aged 60 and over. Many professionals in their 40s are significantly under-contributing relative to what is allowed — and therefore leaving substantial tax relief unclaimed.
If you have not reviewed your pension contribution level recently, that review alone could be worth thousands of euros.
Mistake 3: Losing Track of Old Pensions
Career mobility means that many Irish professionals have accumulated pension pots across two, three, or more employers. Each one sits in a different provider. Each one has different charges, different funds, and different projected values. Together, they add up to something — but nobody can tell you what that something is without pulling all the pieces together.
Pension consolidation is not always the right answer — but knowing what you have and making a considered decision about it absolutely is.
Mistake 4: Planning in Isolation From Your Life
Retirement planning is not just a numbers exercise. It is deeply personal.
What does retirement actually look like for you? At what age? In what kind of lifestyle? Are you and your partner aligned on that vision? What role does work play for you — do you want to retire fully, or transition gradually?
These questions matter enormously for how much you actually need to save. And in my experience, most people have never sat down and answered them clearly. They plan for a number without ever defining the life the number is meant to fund.
"A pension is not the plan. It is one piece of the plan. The plan is the life you are building toward."
The Earlier You Start — or the Sooner You Review — the Better
I want to address two groups of people here.
If you are in your 30s and have not yet prioritised your pension: time is your most powerful asset. The compound growth available to you over three or four decades is remarkable.
Even modest, consistent contributions started now will outperform much larger contributions started later. The single best decision you can make today is to start — or to increase what you are already doing.
If you are in your 40s or 50s and have a pension but feel unclear about it: you still have meaningful time to optimise, but the window is narrowing. A pension review now — understanding what you have, what you need, and what the gap is — is one of the most productive financial conversations you can have.
In either case, the starting point is the same: clarity on where you actually stand.
The Role of Financial Coaching in Retirement Planning
Here is where I want to be direct about what I do — and what I do not do.
I am not the person who selects your pension fund or calculates your actuarial projection.
For that, you need a regulated financial advisor.
What I do is help you build the clarity that makes every conversation with a financial advisor far more productive. I help you define what retirement actually means for you, understand the lifestyle you are trying to fund, and identify the decisions you have been putting off that need to be made.
Clients who go through a coaching process before engaging a pension advisor consistently report that those conversations feel different — more confident, more purposeful, more like an active partnership rather than a passive receipt of advice.
That preparation matters. And it starts with one honest conversation about where you are and where you want to go.
Start the Conversation Today
Retirement planning does not have to feel overwhelming. It does not require perfect knowledge or a complete financial overhaul. It requires clarity — about where you are, where you are heading, and what you need to do differently.
If you are based in Galway, anywhere in the West of Ireland, or further afield, I would love to have that conversation with you. Online sessions mean geography is no barrier.
The first step — a free 30-minute Discovery Call — is exactly that. A conversation. No pressure, no jargon, no product pitch. Just clarity.
Disclaimer: This blog is for information and educational purposes only. It does not constitute regulated financial or pension advice. Sid Hegde is a Qualified Financial Advisor (QFA) through the Institute of Bankers Ireland. For specific pension or investment recommendations, please consult a Central Bank of Ireland authorised advisor.
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