Welcome to our FAQs Hub!
Do you have any further questions about how CONNECT works? If you do, this is the right place for you!
Although we have tried to capture all the questions you might ask, we may have missed a few. If there's anything else you need to know, please visit out contact page here.
Yes. We take care of all the communications, investment, administration and advice required to operate your pension scheme, ensuring that your workload is kept to a minimum. Our independent trustees will ensure that CONNECT meets with full regulatory compliance, disclosure and accounting requirements.
No, CONNECT is a Master Trust and our professional and independent trustees have over 20 years’ experience providing experienced, proactive and independent trustee services to pension schemes across the globe. The Connect trustees act to ensure that the scheme is always run in the best interests of your members so you can have confidence that it will stand the test of time.
In CONNECT we have the flexibility to review the individual elements of the solution to ensure they maintain the high levels of quality we demand and are delivering results for you and your employees.
Yes, by offering CONNECT to a number of employers, we are able to ensure your employees will get the all the benefits that come with being a member of a larger pension scheme, but at a fraction of the cost.
Yes, as the employer you have the ability to decide on a contribution structure to suit the needs of your employees. You can vary the rate between job roles, or even individual employees.
No, we have separated the investment decisions from the actual investing. The investment strategies and managers have been chosen by us, and we will continually monitor our investment strategies to ensure that the funds selected are delivering results to meet the members’ needs.
Yes! For most people, reading about pensions is the last thing they want to do. So we need to fight for attention to get the pensions message heard. Our creative style has been developed to be impactful, but also to create distinction and help build levels of trust. Although our member guide covers all of the technical and complex rules of our scheme, it isn’t boring! The information is broken into manageable chunks and examples to display the key information.
The guide also includes a specific section on investment, equipping employees with everything they need to know about the investment options. Our annual statement guides employees through the key figures using illustrative graphs and charts to make complex messages easy to follow.
You may qualify for the State Contributory Pension from age 66 (Note the state retirement age is to increase to 67 in 2021 and to 68 in 2028).
This is in addition to your pension under CONNECT. Eligibility for the State Pension is subject to satisfying the qualifying conditions for such a payment and is administered by the Department of Social Protection. Further information can be obtained from the Department of Social Protection.
The amount of your pension will depend on the Contributions paid into your Retirement Pot, and the investment return that is achieved. It also depends on the cost of converting your Retirement Pot into an Annuity when you get to retirement, and other things such as your age and possibly your health.
We will send you a statement every year to tell you how much money is in your Retirement Pot and what your pension is estimated to be at retirement. Shortly before your planned retirement date, we will send you another statement which will include information about all of your different options. If you want to check the value of your Retirement Pot more regularly then you can log on to the CONNECT website at www.connectpension.ie.
Approved Retirement Funds (ARFs) are a tax-efficient way of continuing to invest your Retirement Pot after you retire. You can invest all of your Retirement Pot in an ARF, provided your total pension from CONNECT and the State is in excess of certain limits. If you plan to buy an ARF when you retire, you will be responsible for the investment Strategy of these assets after you have retired.
ARF products are available through a wide range of financial institutions. By controlling the asset mix of your ARF, you can manage the income levels it generates in a way that best suits your needs.
ARFs are generally only suitable for larger pension funds and for people who can tolerate significant risk to their income in retirement. Any income drawn down from an ARF is not guaranteed to last for the rest of your life. This is unlike under an Annuity where your pension is guaranteed to be paid for the rest of your life.Some key features of ARFs:
- ARF investments currently grow free of income and capital gains tax (just like pension savings).
- Withdrawals from the ARF are taxed in the same way as other income.
- If you don’t withdraw monies from your ARF, some tax is charged annually regardless.
- You cannot make any further contributions to an ARF during your retirement.
- After your death, any remaining savings in your ARF will be passed to your estate.
- It is important to realise that if you decide to invest in an ARF, you will be accepting a significant degree of uncertainty regarding the level of retirement income that you can expect from your pot and you may be exposed to investment risks in your retirement.
- The costs associated with running an ARF can be material and should be discussed with a financial adviser.
- You will need specialist financial advice at and during retirement if you buy an ARF.
- Regular drawdowns and/or poor investment performance may cause your ARF to become depleted over time and ultimately run out. This may result in your ARF being unable to provide you with any income later in retirement.
Under current tax rules you will get tax relief at your marginal rate of income tax on personal contributions you make to CONNECT as outlined in the following table.
|Up to 30 years of age||15%|
|30 - 39||20%|
|40 - 49||25%|
|50 - 54||30%|
|55 - 59||35%|
|60 and over||40%|
Revenue place a cap on the level of remuneration you may use for determining the maximum contributions above. You may take a tax-free lump sum from your Retirement Pot at retirement subject to Revenue limits.
Revenue require that normal retirement is set after age 60 but before age 70. Your Normal Retirement Age is detailed in your new entrant letter.
Under current tax rules you will be subject to tax as earned income on any pension you will receive after retirement.
Revenue have imposed restrictions on the maximum pension, tax-free lump sum and Retirement Pot that a member can accumulate at retirement. Generally speaking under current tax rules:
- The maximum Retirement Pot a member may accumulate at retirement is known as the Standard Fund Threshold (SFT).
- The maximum pension on retirement is two thirds of your final remuneration.
- There is a maximum tax-free lump sum that you may take from all your pension arrangements.
- The maximum death benefit under the CONNECT pension scheme is four times Salary plus a return of the amount your member contributions to the CONNECT scheme.
Transfers in from other Revenue-approved company pension plans (from previous employement) will in most cases be accepted by CONNECT. Transfers from overseas pension plans must be dealt with on a case-by-case basis because of differences in the strict laws governing pensions from country to country.
Transfers in from a PRSA may also be accepted by the Trustees.
In arriving at a financial settlement following the granting of a decree of judicialm separation or divorce, the Court is obliged to take pension assets into account. This does not apply to separation agreements not involving the Courts.
Broadly speaking, there are two approaches the Court may take in dealing with pension assets.
1. The Court may serve a pension adjustment order on the Trustees, requiring the Trustees to pay a proportion of pension benefits to the member's spouse or family; or
2. The court may take account of the value of pension assets by making an adjustment to the allocation of other assets. If you would like more information, please email firstname.lastname@example.org.
Leaving and Absence
If you leave your employer before Normal Retirement Age having completed two years or more of qualifying service, you may:
- leave your Retirement Pot in CONNECT. It will continue to accumulate with investment returns until you retire.
- You may within two years of leaving CONNECT,or such longer period as agreed by the Trustees, transfer the value of your Retirement Pot to another approved pension scheme, a buy-out-bond in your own name or a Personal Retirement Saving Account (PRSA).
If you have less than two years’ qualifying service, you will only be entitled to a refund of any contributions made by you under CONNECT less tax. You will not be entitled to any contributions paid on your behalf by your employer under CONNECT.
You may retire at any time on the grounds of ill health subject to the consent of the Trustees and certain qualifying conditions.
The value of your Retirement Pot may be lower than otherwise because fewer contributions will have been paid and will have had less time to accumulate.
It is important to remember that the CONNECT Retirement Strategy targets your benefits at Normal Retirement Age. If you wish to retire at a different age (either earlier or later), then the Strategy may not be appropriate for you. You should consider reviewing your investment Strategy or changing your targeted retirement age.
Early or Late Retirement
You may retire early with the consent of your employer and the Trustee after age 50. Remember that if you retire early, the value of your Retirement Pot will be lower than otherwise because fewer contributions will have been paid and contributions paid will have had less time to accumulate.
If, with the consent of your employer, you remain in service after your Normal Retirement Age, the retirement options as set out previously are available to you immediately.
Alternatively, you may defer receiving your benefits until the date when you actually retire. Generally speaking the maximum age you can defer your benefits to is age 70.
If you die in service before retirement, your Retirement Pot will be paid to your estate. In addition there may be a further lump sum and/or Dependant’s pension paid as detailed in your new entrat letter.
This will be payable to your Dependants or your estate as the Trustees shall decide. The death in service benefits under CONNECT will be secured by an insurance policy.
The value of your Retirement Pot will be paid to your estate or as a pension for your Dependant at the discretion of the Trustees.
This will depend on the option that you have chosen on retirement. If you purchased an ARF, then the remaining value of your ARF will pass to your spouse or your estate.
If you purchased an Annuity with an attaching Dependant’s pension from an insurance company, then a pension may be payable to your Dependant on your death after retirement. In addition, the Annuity may be guaranteed to be paid to your estate for a certain number of years after your death.
Your Retirement Pot will be subject to an investment management charge, which is a percentage of your chosen CONNECT investment Strategies.
All other costs associated with CONNECT are met by your employer while you remain in employment.Investment Managers’ charges may change if the Trustees revise the CONNECT investment Strategies. Investment Managers’ charges will be detailed on your new entrant letter.