PRSA-holder says State pension inadequate

Karinda Tolland started contributing to a Personal Retirement Savings Account (PRSA) earlier this year. Although the monthly contribution takes just €350 out of her pay packet, the tax relief available on pension contributions means that a sum of €625 is actually being invested in her pension fund every month.

"I was a little bit concerned with how much tax I was paying and the pension was one way to reduce that," says Tolland, a 30-year-old Australian citizen who has been living and working in Dublin for three years.

"I wouldn't want to rely on a State pension, either here or in Australia," she says. Nor was she tempted to wait for "a knight in shining armour" to provide her with a cash bonanza for retirement. "Even if I don't stay in Ireland for more than a few years, a pension is a good investment. I would more than likely leave the fund growing in Ireland and benefit from the effect of compound interest."

In Australia, pensions are compulsory for all working people. Everyone must contribute a fixed percentage of their salary to what is known as a superannuation fund, and Tolland already had about six years' worth of contributions built up in her fund before she came to Ireland.

It was her Irish employer's invitation to Irish Life to come in to her workplace and talk to staff that prompted Tolland to take out a standard PRSA.

"I would probably never have got around to getting the information myself," says Tolland, who believes that compulsory pensions are a good idea.