Two common pension structures
A PRSA is a Personal Retirement Savings Account. It is a personal pension contract that can follow you through different jobs and employment situations. People often use PRSAs when they are self-employed, changing jobs, or do not have access to a suitable workplace pension.
An occupational pension is a workplace pension scheme set up by an employer. It is linked to your employment and may include employer contributions. The scheme rules, fund range, charges and retirement options can depend on the employer and the pension provider.
The biggest practical difference is ownership and connection to your job. A PRSA is personal to you. An occupational pension is connected to your employment. If you leave the employer, you may have options such as leaving the benefit where it is, transferring it, or moving it into another arrangement depending on the rules.
Cost and investment choice can vary in both structures. Some workplace schemes have attractive employer contributions and negotiated terms. Some PRSAs offer flexibility and portability. The better option depends on your circumstances, the available charges, the contribution setup and the fund range.
What to compare
Do not judge the pension only by the label. Compare what you actually receive.
- Is there an employer contribution?
- What are the charges?
- What funds are available?
- What happens if you change jobs?
- What retirement options are available under the rules?