Stay on track retirement - Your Scheme Handbook - Ireland Investment Profiler
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retirement
Stay on track
Your Scheme Handbook
For members of the Bank of America Ireland Pension Scheme
Start your journey
2021
Contents
Introduction 3
The Scheme at a glance 4
Contributions 8 The 3-step plan 5
Investments 10 Joining 6
Bank of America (the bank) provides a valuable and flexible benefit package. An important
Risk profile 12
part of this is helping you provide for your retirement. The Bank of America Ireland
Control 14 Pension Scheme (the Scheme) helps you do just that.
The Scheme provides a tax-efficient way
to save for your future. The small print:
It is flexible: You choose – • The handbook aims to help you make some important
• How much to save in addition to the bank’s contributions, decisions which will affect your retirement savings. You
• How your contributions are invested, and may feel comfortable making these decisions yourself
Benefits at retirement 22 or you may wish to seek financial advice. See page 29
• How to take your benefits at retirement.
for more details about financial advice.
It is cost effective: You automatically receive tax relief on your • The information in this handbook is based on our
The State Pension 24
contributions at your highest rate of income tax (up to Revenue understanding of tax regulations and legislation in
limits). Please note: The bank meets the Scheme’s administration force at the time of publication. The provisions may
Benefits on death 25 costs and you pay the investment Annual Management Charges. be changed if required by amendments in legislation,
Further information 28 It gives you investment choice: There are two investment taxation, Revenue practice, or bank policy.
Benefits on leaving
service and absence 26 approaches to choose from and flexibility within each approach. • There are other more formal documents (Trust Deeds
Trustees and advisers 30 This aims to offer something for everyone. and Rules and policies for example) which are the
It gives you and your family financial protection: The legal documents that govern the Scheme. You can
Scheme provides a death-in-service lump sum benefit, with request a copy of these at any time. Contact the
Key terms 31
the flexibility to increase or decrease this benefit through the Scheme Administrator for details (see page 29).
MyBenefitChoices flexible benefit website on an annual basis. • If there is any difference between the information in
this handbook and the more formal documents
This handbook gives you an overview of how the Scheme works, governing the Scheme, the more formal documents
its features, and other details you need to help you get the most shall take precedence.
out of your membership and manage your Retirement Account.
2 3
The Scheme at a glance The 3-step plan
You join the Scheme and a Retirement Account is set up in your name
You need to prepare for retirement. And you need to check regularly that you are heading
The bank contributes to your Retirement Account in the right direction. The following three simple steps should help you on your way.
The amount depends on your length of service and how much you contribute. The bank contributes a minimum of 6% of your
Salary and will then match certain contributions €1 for €1, in line with your length of service, subject to certain limits. See page 8 Remember that it is not about saving more than you can afford or becoming an investment expert. It is about
for more details. having a plan, making the right choices for your personal circumstances and checking your progress regularly.
You can contribute to your Retirement Account to increase the benefits you are likely to receive when you retire 1 Set a target
You can make voluntary contributions on the MyBenefitChoices flexible benefit website, either: How much will you need to live on each year when you stop working?
• during the MyBenefitChoices Annual Enrolment period each November, or Setting yourself a target will help you focus and keep on track.
• at any time during the year. See page 8 for more details. • Once you have set a target, you need to see if your estimated pension savings will meet your needs at
retirement. You receive an annual benefit statement from the Scheme which will help you see if you are on
You can also make Additional Voluntary Contributions at any point during the year. Additional Voluntary Contributions are
track. And you can check the value of your Retirement Account online at any time; see page 7.
contributions paid outside of MyBenefitChoices.
• If you think your retirement savings will fall short of your target, think about how to close the gap.
Acting on Step 2 and 3 below can make a big difference.
You choose how to invest your Retirement Account
The Scheme offers you two ways of managing your investments and a range of funds. See page 10 for more details. Do not forget to consider any other sources of potential income when you retire. For example,
you may have another pension plan and a State Pension and your spouse may also have a pension.
Value of your Retirement Account you have built up
Retirement benefits for you/your family and dependants 2 Save as much as you can afford
Think about how much you can save in your Retirement Account to help meet your target.
If you leave the Scheme… When you take your benefits… If you die… The Scheme is a great way to provide for your future, and your savings receive an extra boost from the bank:
• You automatically receive tax relief on your contributions at your highest rate of income tax
…and have less than 1 year of …you can choose to: …before retirement while still (up to Revenue limits).
Qualifying service, you can: • Take a lump sum (some of which employed by the bank: • The more you contribute, the more the bank contributes, subject to certain limits (see page 8).
• Receive a refund of the value of may be tax free). • The value of your Retirement • You can change your level of voluntary contributions on the MyBenefitChoices flexible benefit website
your own contributions (excluding • Buy an annuity (known as a Account at the date of payment is either during the MyBenefitChoices Annual Enrolment period each November or at any time during
the bank’s contributions) less tax, pension) which provides a regular paid to your Estate. You will also the year. You can also make Additional Voluntary Contributions outside of MyBenefitChoices at any time.
or income. receive: See page 8 for details.
• Transfer the value of your own • Take a taxable cash lump sum. - 8 times your Salary at the date
contributions (excluding the bank’s of death, or Use the Pension Projection Tool tool on the Invesco pensions website (see page 7) to see the
• Move to an Approved Retirement
contributions) to another approved - You can choose a different level difference that changing contribution levels has on your estimated pension.
Fund (ARF).
pension plan. of life assurance cover through
See page 22 for more details. Please
MyBenefitChoices.
note not every option is available to all
…and have 1-2 years of members and will depend on Revenue 3 Make your money work harder
Qualifying service, you can: rules and limits. …after leaving the bank as a
How you invest your Retirement Account directly affects its value when you retire.
• Receive a refund of the value of Deferred Member:
your own contributions (excluding As a result it is important to make sure you are not missing out on potential valuable investment returns.
• The value of your Retirement
the bank’s contributions) less tax, Account at the date the payment Before you make an investment choice, you need to consider the options available
or is made will be paid to your and what is right for your personal circumstances. See page 10 for more information.
• Transfer the full value of your dependant(s) before your normal What is right for you will depend on a number of factors, including your age and attitude,
Retirement Account (including your retirement age. and approach to risk and control.
own and bank contributions) to
another approved pension plan.
…after having taken your benefits Use the Investment Profiler at www.irelandinvestmentprofiler-bofa.com to see what sort of
from the Scheme in retirement: investor you are and what may be right for you.
…and have more than 2 years of • The benefits will depend on the
Qualifying service, you can: decisions you made when you
• Leave the full value of your retired.
Retirement Account (including your
*Important note: The Revenue currently only
own and bank contributions) in the
allows tax-free lump sums up to a maximum
Scheme, or
of four times final remuneration plus the value
• Transfer the full value of your of your voluntary contributions and Additional
Retirement Account (including Voluntary Contributions in your Retirement
your own and bank contributions) Account. Death benefits in excess of this
to another approved pension plan. amount must be used to secure an income for
your dependant(s).
4 5
Joining Managing your
Retirement Account online
When you join the Scheme and eligibility Steps to take when joining the Scheme Already registered? Not yet registered?
Employees of the bank over 18 and under 65, and who are not When you join the Scheme, a Retirement Account is set up Logging on from the bank’s network? Logging in from the bank’s network?
members of any other Bank of America pension arrangements, in your name. You will then need to complete the following Use Simplified Sign On (SSO): • Use the links on HR Connect (see opposite).
are eligible to join the Scheme. four actions: • Use the links on HR Connect > Benefits > Financial > • Input your unique Member Number (you received in the post)
If you meet the conditions above, you will be automatically Bank of America Ireland Pension Scheme. and follow the short registration process to generate
enrolled into the Scheme from the first day of your third month
1 • Your standard ID number (or NBK) and password will a password.
of employment. If you join the bank under age 18, this would be Choose how much to contribute. identify you. • Once complete, you will be able to access your Retirement
the first day of the month after your 18th birthday if later. You will receive an email within a week of joining Logging on from outside the bank’s network? Account on the Invesco pensions website instantly through
with enrolment details and a PIN for MyBenefitChoices, • Go to www.invescoonline.ie/boa SSO. You will need your unique Member Number and
Electing not to join the Scheme the bank’s flexible benefits programme. You then • Log in with your Member Number and password.
password for access outside of the bank’s systems.
It is not a condition of employment that you join the Scheme make your voluntary pension contribution choice Logging on from outside the bank’s network?
for retirement benefits. However, if you choose not to on the MyBenefitChoices website by using the links on • Go to www.invescoonline.ie/boa
join the Scheme, the bank will not contribute to any other SSO on HR Connect > Benefits > Quick Links > Manage
• Input your unique Member Number (you received in the post)
pension arrangement on your behalf and you will not receive your benefits. Accessing your Scheme details online will give and follow the short registration process to generate
an adjustment to your salary to reflect the loss of employer Remember: You can make changes to your voluntary you control and flexibility over your retirement a password.
contributions. You will however still remain covered for contribution level either during the MyBenefitChoices planning. You will be able to: Forgotten your unique Member ID and/or password?
death-in-service benefits. annual enrolment period each November or at any time
• View the value of your Retirement Account. Contact the Scheme Administrator – see page 29.
If you choose not to join the Scheme and later change your during the year; see page 31 for more details.
• See the estimated pension income from your
mind, you may be able to join the Scheme at a later date but
Retirement Account.
only with the consent of the bank and the Trustees. Contact 2
the Scheme Administrator for further information; see page 29
• Review and update how your Retirement Account is
Register to manage your Retirement invested at any time.
for contact details.
Account online. • Update your Expression of Wish details.
Transferring in benefits from a previous See the next page for details of how to register, and • Use the Pension Projection Tool to see the effect that
page 29 to contact the Scheme Administrator, Invesco. making different contribution choices will have on your
pension scheme
benefits from the Scheme.
The Scheme may accept transfers in from other similar • Access useful Scheme information, including
retirement arrangements, subject to various requirements being 3 Fund Factsheets.
met. You may wish to seek financial advice (see page 22 for
Choose how to invest your
details) before transferring your benefits. Contact the Scheme
Administrator for further details (see page 29). Retirement Account.
See page 10 for more information on your investment
Information for EU Outgoing Workers options. Once you have registered for online administration
(Step 2) you can make your choice online and change it at
You are an Outgoing Worker if you joined the bank on or after
any time.
13 September 2019, your most recent employment was in another
EU member state and you were an active member of your previous If you do not make an active decision, your Retirement
employer’s pension scheme. Account will be automatically invested in the Lifestyle
approach.
If you wish to find out more about the rights of Outgoing
Workers, please see page 29 to contact the Scheme
Administrator, Invesco. 4
Nominate who will receive your benefits in
the event of your death.
Once you have registered for online administration (Step
2) you can make your Expression of Wish choices online.
Alternatively, you can complete and return a paper form –
also available on the Invesco pensions website. Remember:
It is important that you keep your nominations up to date –
particularly if your personal circumstances change. You can
update your details at any time.
The Trustees of the Scheme will consider the nominations
on your Expression of Wish form (but please note that they
are not binding on the Trustees) before paying out death
benefits at their discretion.
6 7
Contributions
Saving for retirement may not be a priority for you – particularly if retirement seems a long Examples
way off. But the more you save and the earlier you start, the higher your benefits are likely
to be when you retire. The tax relief available for retirement savings makes it worthwhile, no
Laura, 26, is a basic-rate tax payer (20%) and Sean, 47, is a higher-rate tax payer (40%) and
matter what age you are. has a Salary of €20,000. She has worked for the has a Salary of €50,000. He has worked at the
bank for 3 years. bank for 17 years.
Bank contributions The bank pays The bank pays
When you join the Scheme for retirement benefits, the bank You pay (less than 15 years’ (15 or more years’ Laura decides to pay 3% of her Salary to her 3% Sean decides to pay 8% of his Salary to his 8%
contributes a minimum of 6% of your Salary. service completed) service completed) Retirement Account. Retirement Account.
In addition, the bank will then match certain voluntary 0% 6% 6%
contributions you make to the Scheme, €1 for €1, in line with
1% 7% 7%
your length of service. This is set out in the table opposite.
2% 8% 8% Laura’s gross pay would reduce by Sean’s gross pay would reduce by
Your voluntary contributions will attract additional €600 a year.
€600 €4,000 a year.
€4,000
bank contributions: 3% 9% 9%
• Up to 6% of your Salary if you have less than 4% 10% 10%
15 years’ service, or The bank will contribute €7,000 a year to
5% 11% 11% The bank will contribute €1,800 a year to
Sean’s Retirement Account – the minimum
• Up to 9% of your Salary if you have more than Laura’s Retirement Account – the minimum
15 years’ service.
6% 12% 12%
contribution of €1,200 (6%), and an additional
€1,800 contribution of €3,000 (6%) and an additional €7,000
7% 12% 13% matching contribution of €4,000 (8%), as Sean
Please note: Service with legacy organisations (as set by matching contribution of €600 (3%).
has been with the bank for more than 15 years.
the bank) counts towards the 15-year continuous service 8% 12% 14%
requirement for higher matching. 9%+ 12% 15% Therefore a total of €2,400 a year will now Therefore a total of €11,000 (22%) a year
go into Laura’s Retirement Account.
= €2,400 will now go in to Sean’s Retirement Account.
= €11,000
Please note: All percentages are of the member’s Salary.
Your contributions
Contributing 3% costs Laura just €480 a year (in terms of Contributing 8% costs Sean just €2,400 a year (in terms of
Voluntary contributions Please note: take-home earnings) due to tax relief on her contributions take-home earnings) due to tax relief on his contributions
You do not have to contribute to the Scheme. You may, however, • Contributions are subject to Revenue limits – see the next at her marginal rate of income tax. at his marginal rate of income tax.
contribute a percentage of your Salary on a voluntary basis page for more details.
through MyBenefitChoices at any point during the year, which • You can choose how to invest voluntary contributions
and Additional Voluntary Contributions. Tax-relief limits Remember:
will be invested in your Retirement Account. These voluntary
contributions will attract additional bank contributions, up to • You can make voluntary contributions through Based on current legislation and Revenue rules, any contributions The benefits you will receive will depend on the:
certain limits, as set out in the table on the right. MyBenefitChoices at any point during the year. you make (voluntary contributions and Additional Voluntary • Value of your Retirement Account (which in turn depends on
• To make Additional Voluntary Contributions, please contact Contributions) get full tax relief at your marginal rate of income the amount paid in by the bank plus your contributions, and
As you can see, if you are not making voluntary contributions to tax, up to the limit that corresponds to your age in the following
the Scheme Administrator – see page 29 for contact details. how the funds in which you choose to invest perform), and the
the Scheme, you are missing out on potential additional bank table. This does not include the contributions the bank pays.
contributions. These could make a big difference to your future • Cost of buying benefits (such as a pension) when you retire.
lifestyle. Use the Pension Projection Tool on the Invesco pensions Age Maximum contribution The value of your Retirement Account is used to provide your
website (see page 7) to see the difference that changing Important: benefits at retirement.
contribution levels has on your estimated pension. (in the relevant tax year) (as a % of earnings)
Both terms used by the bank to describe your
You can make voluntary contributions on the MyBenefitChoices contributions i.e. voluntary contributions and Additional Up to age 30 15%
website – see page 31 for details. Voluntary Contributions are treated the same by Age 30 to 39 20%
the Revenue (and the Revenue usually refer to all
voluntary member contributions as Additional Voluntary Age 40 to 49 25%
Additional Voluntary Contributions
Contributions). This means for example that: Age 50 to 54 30%
You also have the opportunity to further increase your Retirement • You are eligible to transfer voluntary contributions and/ Age 55 to 59 35%
Account by paying Additional Voluntary Contributions which or Additional Voluntary Contributions to an Approved
do not attract matching contributions from the bank. These Age 60 or over 40%
Retirement Fund (see page 23 for full details) and/or an
Additional Voluntary Contributions are typically paid outside of Approved Minimum Retirement Fund, and
MyBenefitChoices directly to the Scheme Administrator at any Your total pension contributions (including those made to any
• Both voluntary contributions and/or Additional Voluntary
point during the year. These can be paid regularly but are more other pension arrangements) are also subject to a tax-relief limit
Contributions are taken into account when calculating
usually lump sum payments. on your earnings (including income from sources other than the
any tax-free cash lump sums at retirement.
bank) of €115,000 based on current legislation.
More information and updates on the maximum tax-relief limits
for your contributions and annual earnings limits can
be found at www.revenue.ie.
8 9
RISK Missed opportunity risk
There are two ways you can invest your Retirement Account. Your choice may be
influenced by your age and your approach to investment risk, as well as how much control The risk that you are too cautious with your investments. This could mean
Your investment choice will that you end up with less in your Retirement Account at retirement than you
you want over your Retirement Account. depend on your personal could have had if you had made different investment choices.
circumstances. Before you
The value of your Retirement Account depends on: Your choices decide, it is important that you Inflation risk
1. Contributions paid into your Retirement Account, and understand the importance
The risk that your investment returns are lower than inflation, meaning the
2. Investment returns achieved on these contributions.
Choosing an investment approach of risk and control when it comes
‘real’ value of your Retirement Account goes down. Inflation risk is generally
You can either choose the Lifestyle approach or one or more of to making your decision. This higher with investments that take lower investment risk, like cash, which
Therefore, it is essential that you understand your investment
options, so that you can make the right decision for you and your
the Freestyle funds. section sets out full details. typically generate lower returns in the long term although generally offer a
personal circumstances. The Lifestyle ‘do it for me’ approach is where the day-to-day What does risk mean to you? Is it the higher level of protection.
investment decisions are made on your behalf. The Freestyle value of your retirement savings falling?
Helpful tools ‘do it yourself’ approach allows you to select investment funds Or could it be your retirement savings Investment or capital risk
yourself. not keeping up with inflation? Risk comes
• Find out what sort of investor you are and what options may in different forms and each type of The risk that your investments will fall in value. It is what most of us think
be right for you at www.irelandinvestmentprofiler-bofa.com. The following pages set out simple steps to help you choose of when we think of risk. Different types of assets carry different levels
investment has the potential to deliver
• Access the Fund Factsheets on the Invesco pensions website what’s right for you. The most important thing is that you take of investment risk, for example, equities have higher investment risk,
certain levels of return, but has certain
(see page 7). control and review your choices regularly. and returns are more likely to fluctuate compared to a more predictable
risks attached. Here is an overview of the
different types of risk that you should investment like cash. The key thing to remember when considering
Changing your investments consider when deciding how to invest investment risk is that it also has a link to potential returns. As a general
Financial advice You can change how your Retirement Account is invested at any your Retirement Account. rule, the lower the investment risk, the lower the potential return and vice
The Scheme Administrator, Trustees and the bank cannot time on the Invesco pensions website; see page 7 for details. versa. So, while cash or bonds may appear safer in terms of investment risk,
give you financial or investment advice. If you are not sure you could also be missing out on higher returns, especially if you are a long
Please note:
what is right for you, we strongly recommend you get way from retirement.
• If you choose the Freestyle approach, you can choose
financial advice. See page 22 for more details. different investment funds for your existing and future assets.
• You can currently change your investment choices Conversion risk
without charge. The risk that your Retirement Account will buy less income in retirement
than you expect. The cost of converting your Retirement Account into an
annual income is impacted by some of the same factors that impact bond
returns. You can help reduce conversion risk by investing in funds that
contain bonds as you approach retirement. It is a particularly important
risk to consider as you get closer to your retirement. Please also note that
conversion risk will also apply for conversion of your Retirement Account
into another asset class – cash, for example.
10 11
Your risk profile
Your risk profile: You now need to consider how much investment risk you are comfortable The graphics below show some circumstances that might indicate whether you have a
taking. Generally, the more investment risk you are able to take, the greater the potential higher, medium or lower ability to take investment risk. These are broad categorisations
to grow your savings over the longer term. but will get you thinking about how much investment risk you are in a position to take.
• Your age. One important factor to consider is your age.
Generally, the younger you are and the further you are from
retirement, the more risk you are likely to be able to take. This You may have a higher ability to take You may have a medium ability to take You may have a lower ability to take
is because if the value of your Retirement Account falls in the investment risk if some or all of these investment risk if some or all of these investment risk if some or all of these
short term, you should still have sufficient time to reconsider points apply points apply points apply
your level of contributions and/or your investment risk profile,
or for markets to recover to offset any loss. The closer
you are to retirement, the more you may want to consider
protecting the value of your Retirement Account and so may
find investments that take less investment risk more suitable. Ability to take investment risk Ability to take investment risk Ability to take investment risk
• The importance of your retirement savings in the Scheme. • Retirement savings: You have significant retirement • Retirement savings: You have retirement income • Retirement savings: You are relying on your income
If you expect your retirement benefits from the Scheme to income from other sources and expect your income from other sources but expect your income from the from the Scheme as your main source of income
make up only a small part of your retirement income, you from the Scheme to make up only a small part of your Scheme to make up a reasonable part of your income when you retire.
may be able to take more investment risk with your savings. income when you retire. when you retire. • Earnings: You expect your earnings to increase
Conversely, if you expect to rely on your retirement benefits • Earnings: You are early on in your career and expect • Earnings: You expect your earnings to fluctuate (for steadily over your career.
from the Scheme for a large part of your retirement income, your earnings to rise quickly. example, rising quickly when you are younger before • Contributions: You expect to contribute steadily to
you may prefer to take less investment risk. levelling out, or fluctuating because of the nature of
• Contributions: You expect to make significant your Retirement Account and would find it difficult to
• Your earnings and disposable income. If your savings in the contributions to your Retirement Account or your job or because of a career break). top up your Retirement Account if it falls in value.
Scheme fall in value, you need to think about how easy it have other savings, so could afford to top up your • Contributions: You expect to contribute more to your • Retirement flexibility: You have little or no flexibility
would be for you to top up your savings. The more disposable Retirement Account if it falls in value. Retirement Account early on and would find it easier to delay taking your income from the Scheme,
income you have, the easier it should be to make up any to top up your Retirement Account when you are
• Retirement flexibility: You have flexibility to delay and would not be willing to work for longer if your
shortfalls. younger.
taking your income from the Scheme or would be Retirement Account falls in value as you approach
• Your contributions. How much you can afford to contribute willing to work for a little longer if your Retirement • Retirement flexibility: You have some flexibility to retirement.
to the Scheme is important. Just as important is when you Account falls in value near to retirement. delay taking your income from the Scheme and would
are able to contribute, as the longer your contributions are be able to work for a little longer, if your Retirement
invested, the more you should benefit from investment Account falls in value as you approach retirement.
growth and potential interest. Remember, the more you
contribute, the more the bank contributes too.
• How much flexibility you have about when you retire. The
more flexibility you have about when you take your retirement
Attitude to investment risk Attitude to investment risk Attitude to investment risk
benefits, the more investment risk you may be able to take.
This is because if your Retirement Account falls in value, You are a risk taker by nature; you are comfortable You are willing to take some investment risk with your You are cautious by nature and are willing to trade the
you might be able to work for longer or delay receiving your investing in the most risky funds and are prepared for your money but prefer to spread this risk. You accept this could potential for higher growth in return for much more stability.
retirement benefits, hopefully giving your savings time to savings to go up and down in value, sometimes quite sharply. mean losing out on the potential for higher growth, but you
recover. You accept this could mean losing out, but it could also mean are willing to trade this in return for more stability.
• Your attitude to investment risk. Your attitude to taking making bigger gains.
investment risk will also influence your decision, although the
type and level of risk you are comfortable taking may not be
the same as the risk you are able to take; you may have to
rein in your adventurous spirit, or step outside of your comfort Reminder Remember to consider your age when Not sure where to start?
zone to try and achieve the results you want. There are other types of risk that you need to take into making your investment choice Use the online Investment Profiler at
account such as: As set out opposite, generally, the younger you are and www.irelandinvestmentprofiler-bofa.com.
• Missed opportunity the further you are from retirement, the more investment Answer five short questions. The results will give you an
• Inflation risk you are likely to be able to take. The closer you are to indication of your attitude to risk and control and will help
• Conversion retirement, the more you may want to consider protecting you consider an investment option that may be right for
the value of your Retirement Account. you until you reach age 55 when you will also need to
See page 11 for more details.
consider how you plan to access your savings.
12 13
Now that you understand more about risk and have considered where you are on the risk
‘spectrum’, you need to consider how actively involved you want to be in investing your
Retirement Account.
The approach you take will depend on how much control you want, how much time you are prepared to spend
managing your investments, and how confident you are about making investment decisions.
Freestyle Lifestyle
A ‘do it yourself’ approach where you choose and manage a combination of the available funds depending A ‘do it for me’ approach – known as Lifestyle – where the funds in which your Retirement Account is invested, and the proportion held
on how long you have until you retire. in each fund, change automatically during your working life according to how far you are from retirement.
Why it might be good for you Why it might not be good for you Why it might be good for you Why it might not be good for you
Freestyle puts you in control by letting you choose the funds • It takes more active involvement and decision making than • You do not need to be as involved in the management of your • If you prefer to take more control over how your Retirement
you believe are right for you, and change them as and when it the Lifestyle approach. Retirement Account compared to the Freestyle approach. Account is invested and the types of funds that you invest in,
suits you. • You need to think about how you want to invest your • Your investments follow an automatic pre-determined the Freestyle approach may be more suitable for you.
Retirement Account from the start and check regularly that strategy – phasing from funds with higher investment risk to • Freestyle may also be more suitable for you if you plan to take
your investments are on track. lower investment risk, in the years leading up to your normal the value of your Retirement Account at a different age to your
• You have to ensure that you move your Retirement Account retirement age (65). normal retirement age (65). See page 16 for more details.
into funds that take less investment risk in the years leading • During the first part of the ‘growth’ phase, you take a higher
up to your retirement, if you wish to provide more security level of investment risk until 30 years before your normal
around its value. retirement age (65), in order to potentially achieve a high
level of growth. You then gradually reduce volatility, although
still aiming for growth, until 10 years before your normal
retirement age (65).
• As you approach retirement, you will have three options to
choose from to ensure your Retirement Account is invested in
line with how you plan to take your benefits at retirement.
14 15
Your Freestyle options
The funds available through Freestyle are summarised below.
The name of each fund describes the asset class in which it invests, or the principles on which it is based. It
means that the Trustees can monitor and manage the funds, and make any necessary changes quickly and
efficiently (if the Trustees consider that changes are appropriate). See page 20 to read more about the different More about active and passive funds Additional expenses
asset classes. The two equity funds shown in the table on page 16 are Most fund managers have to pay expenses such as auditors,
described as ‘active’ and ‘passive’. legal fees and custody fees. Any additional expenses are
Active funds aim to outperform a market benchmark by taken from the underlying fund and are reflected in the
Fund name What it currently invests in… Aims to… AMC* investing in a selection of investments that the investment unit price of the fund. They are reviewed regularly and are
manager believes will perform better than the market. subject to change.
Equities (%)
The investment manager decides which assets to buy
Active Global A blend of equity investment strategies that Provide positive returns above the benchmark or sell. As returns depend partly on the active involvement
Equity Fund are managed actively. equity index over rolling 3-year time periods, and skill of the manager, typically these funds have higher
0.64
but with lower volatility than a single investment charges. Active funds can also be more volatile Please note: the value of all investment
equity strategy. than passive funds. funds can go down as well as up.
Passive Global A blend of global equity market indices Perform in line with the equity markets Passive funds try to replicate a particular benchmark or
Equity Fund (i.e. investing in traditional equities which it tracks on an on-going basis. The blend index, aiming to achieve the same return. Passive funds
are selected and weighted on the basis of of equities aims to diversify the returns usually have lower investment charges than active funds.
0.14
their market share). The fund also invests in and reduce investment risk over the long term,
Fund Factsheets for the Freestyle funds are available on the
equities selected on the basis of either minimising when compared with traditional
Invesco pensions website; see page 7 for details.
risk or providing additional returns. equity markets.
Ethical Equity Fund Indexed Global equities, which track an ESG Perform in line with the ESG focussed
0.16
Focussed equity index. benchmark index.
Bonds (%)
Diversified Bond A range of traditional asset classes such as bonds, Provide positive returns in the form of income
Fund cash and money market instruments, and uses and capital growth, over the medium to long
0.34
investment strategies based on advanced derivative term.
techniques.
Pre-Retirement A blend of indexed bonds, including government Align with the long-term changes in annuity
0.11
Bond Fund and corporates. prices due to interest rates.
Other types of investments (%)
Diversified Various investment strategies through several fund Provide positive returns over rolling 3-year
Growth Fund managers and in a range of asset classes. time periods with reduced investment risk and
0.61
return volatility relative to traditional multi-
asset or equity only funds.
Cash Fund Money market instruments. Achieve a rate of return in line with wholesale
0.10
money market rates.
* Annual Management Charges (AMCs) correct as at 31 March 2021. The AMC is the annual cost of the fund. It is applied to the market
value of the relevant fund. It is typically accrued daily and deducted from the price of the fund.
Please note: the value of all investment funds can go down as well as up.
16 17
Your Lifestyle options
The flexible Lifestyle option is made up of a combination of the Freestyle funds. The funds When you are aged under 35, which is over 30 years before your normal retirement age
follow a pre-determined strategy where your investments switch depending on how far you Aims to… achieve growth through investing fully in equities
are away from your normal retirement age.
Growth phase
Invests in… • Passive Global Equity Fund
When you are aged between 35 and 55, which is within 30 years of your normal retirement age
More about Lifestyle Aims to… move the equity investment gradually into diversified investments, still with the objective of achieving potential
Normal retirement age is age 65. This age determines growth, but also to reduce volatility
Growth phase: until age 55, you will automatically be invested
in the growth phase. This phase aims to grow your Retirement when your investments begin switching between the Invests in… • Passive Global Equity Fund • Diversified Growth Fund
Account by investing in funds that have the potential for good growth and pre-retirement phases. This date is fixed for
the Lifestyle option. 1. Approved Retirement Fund 2. Annuity 3. Cash
return but which typically take more investment risk. Lifestyle
then transitions into its second phase. See the chart opposite for If you are planning on retiring at a different age, you may When you are aged between 55 and 60, which is between 10 and 5 years of your normal retirement age
information on which funds the growth phase invests in. want to consider choosing the Freestyle approach. This
allows you to choose when you switch your investments Aims to… extend the potential growth Aims to… reduce volatility by moving some of the Retirement Account into asset
Pre-retirement phase: from age 55, you are automatically
from growth funds to funds that will protect the value of period of your Retirement Account classes that take a lower amount of investment risk
invested in the pre-retirement phase.
your Retirement Account, as you approach retirement. by continuing to move some of the Invests in…
This phase aims to provide some protection to your Retirement remaining equity investments into
Account against sudden falls in value as you approach your • Passive Global Equity Fund
diversified investments
Pre-retirement phase
normal retirement age (65). This is achieved through gradually • Diversified Growth Fund
Invests in…
moving it into investments that take less investment risk. Please note: the value of all investment • Diversified Bond Fund
• Passive Global Equity Fund
In this phase, you have three options to choose from, depending funds can go down as well as up.
• Diversified Growth Fund
on how you are planning to use your savings.
The three options are: When you are over 60, which is within 5 years from your normal retirement age
• Lifestyle – Cash
Aims to… reduce volatility through Aims to… further reduce volatility and Aims to… provide further protection
• Lifestyle – Annuity moving some of your Retirement match pension annuity prices through a to the Retirement Account by moving
• Lifestyle – Approved Retirement Fund (ARF). Account into bonds higher exposure to bonds investments into cash
If you do not make an active decision, you will automatically be Invests in… Invests in… Invests in…
invested in the Lifestyle – ARF option. See the charts opposite • Passive Global Equity Fund • Passive Global Equity Fund • Passive Global Equity Fund
for more information.
• Diversified Growth Fund • Diversified Growth Fund • Diversified Growth Fund
• Diversified Bond Fund • Diversified Bond Fund • Diversified Bond Fund
• Pre-Retirement Bond Fund • Cash Fund
How your Retirement Account
Growth Pre-retirement Growth Pre-retirement
moves between the funds
Growth Pre-retirement
100% 100% 100%
% of your Retirement Account
% of your Retirement Account
% of your Retirement Account
80% 80% 80%
60% 60% 60%
40% 40% 40%
20% 20% 20%
0% 0% 0%Different types of investment fund Investment diversification
Investing in different types of investment funds or asset
More about ‘buying power’ and
‘conversion risk’
classes helps to diversify or ‘spread’ investment risk. This When you retire, you can use the value of your Retirement
diversification means that you are less dependent on the Account to buy an annuity (otherwise known as a pension)
The table below gives an overview of the different asset classes in which the Freestyle performance of any one asset class by spreading the from an insurer. This income is payable for the rest of your
investment risk and reducing the impact if one or more life (and that of your spouse if you choose this type of
funds invest, and sets out how effectively they achieve one of two aims. This will make it asset classes suffer(s) from poor performance. annuity).
clearer how the different types of risk relate to each asset class. You can diversify your investments by choosing from the Typically insurers will invest the money they hold to back
various asset classes available to you through the Freestyle these annuities in bonds (see page 20 for a description of
The higher the star rating, the more effective the asset class may be in achieving the respective aim. funds. bonds). Long-term interest rates (or yields) on bonds are
The maximum star rating is five. The Freestyle funds also include a single fund which an important factor when setting annuity rates. Changes in
provides investment diversification: the updated Diversified yields on bonds can therefore have an effect on their value
Aims to Growth Fund. This fund invests various investment and also on the price of annuities; an increase in yields could
Asset class strategies through several fund managers, and in a range result in a reduction in the amount you could get for selling
Deliver long-term Provide security bonds. However, an increase could also result in an increase
of asset classes including equities, bonds, cash and
growth and stability in the annuity you can buy with your Retirement Account.
alternative assets. Investing in the Diversified Growth
Equities or shares are stocks in companies. Equities are expected to generate higher rates of Fund therefore offers you the opportunity to diversify the The opposite is true if yields fall i.e. the value of your
return in the longer term than bonds or cash, but carry a higher risk because they are more investment of your Retirement Account through one fund. bonds may increase but the annuity you can buy may
volatile to fluctuations in the stock market. Equities are generally considered a good way to The Diversified Growth Fund forms a key component of go down as a result. Investing in bonds in the lead up to
invest your money in the long term, since you have time to weather the ups and downs of the the Lifestyle approach (see page 18 for more details). buying your annuity could help to maintain your annuity
stock market. This differs to absolute return bond funds which aim to achieve growth in all ‘buying’ power, by linking how your Retirement Account is
market conditions, albeit typically with lower long-term returns than equity funds. invested before your retirement more closely to the types
of investments used to set annuity rates. This is reducing
Bonds are loans to a company or government. You typically receive a fixed return on ‘conversion risk’ at the point in time you take your annuity
your investment, or ‘interest’ on the loan, except for index-linked bonds which pay a return (see page 11 for more details).
that increases with inflation. Bonds typically give lower returns over a longer period than Conversely, if your Retirement Account is invested in other
equities, but they are generally more secure and predictable. types of investment funds that are not invested in such
a similar way to annuity funds, there is a higher risk that
Money market and cash refers to a range of money market instruments and cash.
changes in the value of your Retirement Account will not
They are considered better at protecting the capital value of your Retirement Account
be offset by changes in the annuity you can then buy. This
in the short term than other types of investments, such as equities. However, money market
‘conversion’ risk could result in you seeing the amount
and cash typically provide lower rates of return in the long term and there is
you can buy as an annuity decreasing if the funds you are
still a risk that they can go down in value from time to time.
invested in fall in value as you approach your retirement.
The opposite is also true, in that if your Retirement
Account suddenly increases in value and annuity rates stay
the same, you will be able to buy more annuity/pension.
20 21Benefits at retirement
When you retire, your retirement benefits will depend on: Options at retirement
• How much you and the bank contribute during your employment;
• How well the funds in which you choose to invest perform; and Option Description Factors to consider
• How you choose to use your Retirement Account.
Lump sum You may be able The lump sum you can take is subject to limits that are The absolute maximum level of tax
to take a cash imposed by Revenue and the amount in your Retirement relieved lump sum benefit that can
Taking your savings lump sum from
your Retirement
Account. It will also vary with the circumstances of your
retirement, your service with the bank and benefits from
currently be taken from all sources
is €500,000, and for the 2020 tax
Account. other sources, and there are two ways of calculating the year, lump sum benefits are taxed
Taking your savings early Information for EU Outgoing Workers
maximum lump sum benefit you are entitled to, as set as follows:
Your normal retirement age is 65. With bank’s consent, you may If you’re an Outgoing Worker and you are leaving the Scheme: out below: • The first portion, up to €200,000
retire from age 50. You may also retire early by leaving the bank • With a preserved benefit (you have two or more years’ • Service: The maximum lump sum benefit is 1.5 times can potentially be taken tax free.
(at any time) if you are in ill-health or are disabled (subject to the Qualifying Service), you are entitled to a preserved benefit your earnings from the bank when you retire. If you However, this would depend on
Trustees’ agreement). In the case of ill-health or disability, the retained in the Scheme in all circumstances except wind-up have short service or retire before normal retirement the level of lump sum benefits
bank operates a separate Income Protection Plan. In most cases • Without a preserved benefit (you have less than two years age, the maximum lump sum you may take will be you may have taken from other
the terms of the Income Protection Plan will apply until age 65. Qualifying Service), you may be entitled to a refund of smaller than 1.5 times your earnings and depend on sources.
your pension contributions plus the banks contributions certain service requirements. • Sums between €200,001 and
Deferring the payment of your savings made in respect of periods of employment falling after • Fund size: The maximum lump sum benefit is 25% of €500,000 are liable to the
With the bank and Trustees’ consent, you may be able to defer 13 September 2019. Tax is deducted at a rate of 20%. your Retirement Account. standard rate of income tax in
taking your Scheme savings until after your normal retirement If you wish to find out more about the rights of Outgoing force at the time of payment,
age (65). Workers, please see page 29 to contact the Scheme currently 20%.
Administrator, Invesco.
Approved You may be An ARF gives you the opportunity to continue to invest Unlike an annuity income, ARF
Your choices
Retirement able to transfer all or part of your Retirement Account in a tax-efficient income is not guaranteed to last
When you retire, you can decide how to use your Retirement Fund (ARF) all, or part, of way after you retire, with the added flexibility to forever. If the rate at which income
Account. You can choose one or more of the following options: the balance of withdraw cash as required. is drawn down exceeds the growth
your Retirement You can withdraw cash whenever you wish, subject to achieved, then the ARF could
Take a lump sum
Account to the terms of the ARF provider. ultimately be reduced to nothing.
(some of which may be tax free an ARF. You don’t pay any tax on investment income or capital This option is an investment vehicle
subject to Revenue limits) gains while money is invested in the ARF. Once the and you should get financial advice
proceeds are withdrawn, they are subject to income tax. before investing in an ARF.
A minimum tax charge is payable each year on the value
^ of an ARF (calculated based on an assumed withdrawal This option is not open to all
of 4% to 6% of the ARF value, depending on your age members and, in order to exercise
Buy an annuity for you and/ Move to an it, a member must be able to
or your dependants (known Retirement Account Approved Retirement Fund and ARF value), irrespective of whether you withdraw
^
^
any money from the ARF. demonstrate that they have a
as a pension) (ARF)
certain minimum level of income
^ An ARF can become part of your estate on your death.
from other sources.
Taxable cash You may be This will only be possible in restricted circumstances, and for many members it is not an
sum able to take option. In many cases taking the balance of your Retirement Account as taxable cash may
Take a taxable the balance of not be tax effective.
cash sum your Retirement Your Retirement Options Statement will detail whether you can use this option. If you are
Account as able to take the balance of your Retirement Account as taxable cash, this would normally
taxable cash. be liable to marginal rate tax, PRSI and the Universal Social Charge (USC), based on your
Not every option is available to all members. Your options will depend on your personal circumstances.
personal circumstances.
The level of savings is subject to the amount available in your Retirement Account and to saving limits imposed by Revenue.
Read on for further details on each of these options. Annuity You can use An annuity is a contract with a life assurance company The amount of income you receive
the balance of that will pay you a guaranteed regular income in from the annuity depends on
your Retirement retirement in return for part of your Retirement Account. a number of things such as:
Remember: Account to • The amount of money used
• You do not have to choose how you would like to take your savings until you approach the age at which you want to retire. Please purchase an to buy the annuity
note however that how you wish to take your savings may influence how you invest your Retirement Account – see pages 10 to annuity. • Your age and health
21 for more information on your investment choices.
• The cost of purchasing a pension
• Details about your options will be sent to you as you approach your normal retirement age (65); if you would like to take your (i.e. annuity rates) at the time
savings earlier, please contact the Scheme Administrator (see page 29).
you retire, and
• It is recommended that you seek financial advice to help you choose the retirement options that best suit your personal needs. • The options you choose
For details of how to contact a Qualified Financial Adviser (QFA) in your local area, visit www.ccpc.ie/consumers/money/getting-
that best suit your personal
financial-advice/do-you-need-financial-advice. If you choose to engage a QFA, this will normally be at your own expense.
circumstances at the point
• When reviewing your options, also consider retirement savings you may have outside the Scheme. of retirement.
22 23The State Pension Benefits on death
In addition to the pension benefits from the Scheme you may be entitled to a State If you die while employed by the bank Nominating your beneficiaries
Pension. To qualify for a State Pension (Contributory) you must be aged 66 or over and If you die in service, a death benefit will be payable equal to: The Trustees of the Scheme will consider the nominations on
• The value of your Retirement Account at the time the benefit your Expression of Wish form (but please note that they are not
have enough Class A, E, F, G, H, N or S social insurance contributions. binding on the Trustees) before paying out death benefits at
is paid. Plus
- 8 times your Salary at the date of your death. Or their discretion. You can update your details online on the Invesco
- Through MyBenefitChoices you can opt to change your pensions website or by completing and returning an Expression
You need to have: The State Pension is payable at State Retirement Age which is 8 times Salary benefit to an amount between two and of Wish form (also available on the Invesco pensions website);
currently 66. see page 7 for details.
• P aid social insurance contributions before a certain age twenty times your Salary at the date of your death.
• A certain number of social insurance contributions paid and An additional allowance for your spouse/partner, known as a Please ensure you update your Expression of Wish details if
• A certain average number over the years since you first Qualified Adult Allowance, may also be payable. This allowance is If you die while in retirement your circumstances change (for example if you get married or
started to pay. subject to an income test and will not be payable if your spouse/ divorced, enter a civil partnership or if you have children).
If you die while in receipt of your retirement income, any benefits
partner’s, income or capital exceeds levels set annually by the payable will depend on the decisions you made when you retired.
Department of Social Protection. The following rates apply from
29 March 2019: If you die after leaving the bank as a Important notes
• As the standard benefit under MyBenefitChoices is
deferred member eight times your annual Salary, your benefits may be
State Pension Increase for Total State Pension If you no longer work for the bank and left your benefits in liable to tax.
(contributory) Qualified Adult (contributory) the Scheme, an amount will be paid to your dependant(s) on • The Revenue only allows tax-free lump sums up to
your death before your normal retirement age. The value of your a maximum of four times final remuneration plus
No spouse / partner €12,911.60 a year €12,911.60 a year
Retirement Account at the date of payment is paid to your Estate. the value of your voluntary contributions and Additional
Spouse / partner under 66 €12,911.60 a year €8,600.80 a year €21,512.40 a year Voluntary Contributions in your Retirement Account.
• Death benefits in excess of this amount must be
Spouse / partner over 66 €12,911.60 a year €11,570.00 a year €24,481.60 a year used to secure an income for your dependant(s).
• When choosing a level of life assurance benefit that
it is right for you, it is vital that you consider your
personal circumstances carefully. If you do not have any
More information about these benefits, other State benefits and the dependants for example, it may not be appropriate to
current terms/conditions is available from your local welfare office. have cover of more than four times your annual Salary.
Alternatively, contact the Department of Employment Affairs and • The 8 times (or as appropriate two to twenty times)
Social Protection at the following details. Salary lump sum benefit is subject to insurance
Address: Social Welfare Services, College Road, Sligo, Ireland being available and in place. There also needs to
Telephone: LoCall: 1890 500 000 be satisfaction of any requirements of the insurer,
including in some cases underwriting requirements.
Online: www.welfare.ie
• Once you reach 65 your Life Assurance cover will cease.
If you wish to extend your cover to age 70, you will be
required to complete full underwriting by the insurer.
24 25You can also read
