What Is the Average Pension in Ireland? (Key Stats, Factors)

The average pension in Ireland is approximately €111,000, according to surveys conducted in 2024.

Is this enough to sustain your employees in retirement? 

What’s considered a good pension pot? 

We’ll answer these questions and break down Ireland’s average pension, helping employers understand how to better support their workforce's long-term financial well-being.

Further Reading

• Discover the Irish Pension Schemes that can help your employees in their post-retirement years.

• Find out the Taxable Amount for Irish Maternity Benefit and get answers to other related queries.

What Is the Average Pension in Ireland?

According to a 2024 Pension Support Line study [1], the average pension pot of Irish employees at retirement is about €111,000.

The same study also found that employees expect to receive a pension pot of around €433,000 at retirement — significantly higher than the average pension of €111,000. 

This gap highlights the importance of employer-provided pension schemes. Offering a robust occupational pension scheme can:

• Improve employee financial well-being by ensuring adequate retirement savings.

• Increase retention and attract top talent.

• Reduce financial stress among your staff, improving productivity and morale.

But why is the average pension not sufficient for your employees?

According to Numbeo [2], Ireland is the 20th most expensive country to live in, making it essential to have a substantial pension pot.

Now, one of the crucial factors affecting your employee’s pension pot is inflation. 

Ireland’s core inflation rate (which excludes volatile food and energy costs) was 5.3% in January 2024 [3], mainly due to higher mortgage interest rates and transport costs.  

Some experts predict that prices will continue to rise slowly in most sectors — even though the general inflation rate seems to be falling [4]. 

For instance, did you know Diageo announced a 6-cent hike in the price of its pints (their third hike in 18 months)? [5] This is after a 12-cent hike in February 2023!

Bottom line: At the current average pension rate, most individuals won’t be able to afford a basic standard of living post-retirement in Ireland.  

That’s why ALONE (a national charity) has asked the government to implement benchmarking for the State Pension, as per the commitment made in the Roadmap to Social Inclusion 2020-2025 policy [6].

But how many people rely on the State Pension?

Let's take a look.

Important Irish Pension Statistics

A 2024 Pension Coverage survey [7] conducted by Ireland’s Central Statistics Office (CSO) observed that: 

• The State Pension was the primary income source during retirement for 52% (seven points down from 59% in 2023) of workers without pension coverage. This is concerning because the State Pension amounts to just about €15,000 a year in 2025, insufficient to cover one’s living expenses in Ireland. 

• Only 67% (a 1% drop from 68% in 2024) of employees had some pension coverage, such as personal or occupational pension schemes, in addition to the State Pension.

• Defined contribution (DC) pensions covered 69% (up from 66% in 2023) of employees enrolled in occupational schemes from their current employer, while defined benefit (DB) pensions covered only 26% (down from 30% in 2023). This shows that DC pensions are more popular than DB plans in Ireland. 

• Pension coverage was lowest among young workers — only 27% (a 6% decrease from 33% in 2023) of workers aged 20-24 had some form of pension coverage.

Further Reading

• Learn about the Auto-Enrolment Pension scheme set to come into effect in September 2025. 

• Jot down the key requirements for your female employees to Qualify for Maternity Benefit in Ireland — ensure your business is fully prepared!

What Is Considered a Good Retirement Pension Pot for Your Employees in Ireland?

A "good pension pot" is subjective — the retirement pension may differ based on your employees' salary, retirement goals, and circumstances.

Financial advisors typically recommend aiming for 50% of an employee’s gross pre-retirement income [8] as a pension. So, if they earned €75,000 per annum before retirement, they’ll need an annual income of at least €37,500 in retirement. 

Let’s look at rough estimates of what your employees should aim to accumulate in their pension pot throughout their careers. 

Note: We calculated these estimates using Ireland’s average wage for full-time workers, which is around €44,202 (pre-tax) per year, according to a 2024 survey by Morgan McKinley [9].

• Average Pension Pot at 30: A 2024 study by Fidelity [10] suggests that your employees should have 1x their salary in their pension pot by the time they’re 30. Considering Ireland's average wage is about €44,202 per year, they should aim for a pension pot of the same amount by 30.

• Average Pension Pot at 40: By age 40, employees should have at least 3x their salary [10] in their pension pot, which would be approximately €132,606.

• Average Pension Pot at 50: At 50, they should aim to have 5x their salary [10] saved in their pension pot, which should be approximately €221,010.

• Average Pension Pot at 60 and Above: By 60, employees should aim to have 8x their salary [10] in their pension pot, which amounts to approximately €353,616. At retirement age (usually 66), their pension pot should have 10x their salary [10], amounting to €442,020. 

Is your employees’ pension pot smaller than they had expected?

Let’s find out why.

6 Key Factors Affecting Your Employees’ Pension Pot in Ireland

Some factors that affect pension entitlements are as follows:

1. Type of Pension Scheme

Your employees’ pension entitlement may differ based on the scheme they have opted for. 

For example, at retirement, some schemes provide a fixed pension amount based on your employee’s salary and other conditions, whereas the returns of some schemes depend on investment performance. 

Types of Pensions Available in Ireland

Three types of pension schemes are available to Irish citizens:

• State Pension: The State Pension (Contributory) and the State Pension (Non-Contributory) are two social welfare payments made by the Irish government to people aged 66 and above. 

• Occupational Pension: Employers offer occupational pension schemes to employees. A defined contribution pension scheme is Ireland’s most common occupational pension scheme.

• Personal Pension: Personal pension (aka private pension) plans are available to self-employed people or employees whose employer doesn’t offer an occupational pension. There are two types of personal pensions: Retirement Annuity Contracts (RAC) and Personal Retirement Savings Accounts (PRSA). 

2. Contribution Rate

The more your employees put into their pension pot, the better entitlements they get. 

Ask them to consider increasing their pension contribution levels if you also contribute to their pension. As an employer you can match their contributions (up to a specific limit), resulting in a larger pension pot at retirement. 

3. Income levels

A higher income level will allow your employees to make larger contributions toward their pension pot. Being the employer, you should consider how an increase or decrease in the employee's salary may impact their pension pot. 

4. Gender 

An employee’s gender can also affect their pension pot upon retirement. 

According to the 2024 Gender Pension Gap Report from Irish Life, the gender pension gap in Ireland between men and women is 36%.

This pension gap mainly arises because women often work part-time, take career breaks, earn less during their working lives, and face high childcare costs. 

As a result, they contribute less to their pensions and have smaller savings.

To help reduce this pension gap, the Irish government launched the "Long-term Carers Contribution" scheme in January 2024. This scheme lets people who have been full-time carers for at least 20 years (1,040 weeks) qualify for the State Pension (Contributory).

5. Inflation

Inflation can cause an employee’s pension pot to lose its value over time. 

As goods and services get more expensive, the purchasing power of your employee’s pension pot reduces. Sound investment decisions and professional financial advice can help to prevent these losses.  

6. Life Expectancy

Ireland's average life expectancy rate as of 2025 is 83 years. 

How does that affect pensions?

Your employees may need a larger pension pot to sustain themselves after retirement. 

For instance, if they retire at 66 and live until 83 (average life expectancy in Ireland), their retirement fund should last 17 years.

Learn about the Retirement Age in Ireland.

Due to rising life expectancy rates, the Irish government increased the State Pension age from 65 to 66 in 2014. Although it was expected to rise to 67 in 2021 and then to 68 by 2028, no provisions for change have been made as of January 2025.

When Can Your Employees Claim Their Retirement Pension in Ireland?

Let’s look at Ireland’s three pension types to understand when your employees can claim their pension income: 

• State Pension: The State Pension is only paid to people aged 66 and above. 

• Occupational Pension: In most cases, employees can claim an occupational pension when they reach the retirement age of 65 or 66, depending on any contractual provisions for mandatory retirement age. However, they can also claim their pension income at 50 if permitted by you, the employer, and the scheme’s trustees.

• Personal Pension: Your employees can claim their pension income at 60 by investing in an Approved Retirement Fund (ARF) or purchasing an annuity. They can also claim their pension income at 50 by taking an early retirement if they have retired from PAYE (Pay As You Earn) employment and are not working elsewhere. 

Further Reading

• Get all the necessary details on when, how, and where your employees can apply for Invalidity Pension in Ireland. 

• Want access to top-notch healthcare in privately owned medical facilities for your employees? Offer them Private Health Insurance in Ireland.

4 Ways You Can Help Your Employees Maximize Their Savings at Retirement 

Want to increase your employee’s retirement savings?

Here’s how you can help them do that:

• Encourage them to Start Saving Early: Starting pension savings early leads to higher investment growth, resulting in a larger pension pot that could sustain your employee’s standard of living during retirement. So, if they haven’t started saving yet, we recommend doing it immediately. 

• Help Them Define Their Retirement Goals: Defining retirement goals will allow your employees to make realistic pension-saving decisions. Once they have decided what they want, they can focus on expenses like healthcare and travel. 

• Ask Them to Evaluate Their Investment Performance: Remind your employees to regularly review their pension fund’s performance against relevant benchmarks to make informed decisions. Also, ask them to consider if the value of their pension fund aligns with their retirement needs.

• Engage Professional Advisors: Facilitate access to qualified financial advisers to simplify pension fund performance management for your employees. These experts can assist with retirement planning and analyze your investment strategy to ensure your business is effectively supporting employees while staying on the right track.

3 FAQs on Average Pension in Ireland

Here are the answers to some commonly asked questions on Irish average pensions. 

1. How Much Will an Irish Pension Provider Charge to Manage Your Employee’s Fund?

The fees pension providers may charge to manage employee investments typically consist of the following:

• Annual Management Charge (AMC): This ranges from 0.5% to 1.5% on average and is based on the value of the employee’s savings each year. The charges may differ across funds.

• Entry fees/charges: Usually between 2% to 5% of your employee’s contributions. This fee applies to the money they invest in their pension fund.

• Policy fee: A fixed monthly payment of around €5 that covers administrative expenses.

Note: The charges for the Auto Enrolment Scheme are expected to be confirmed closer to its launch date of 30 September 2025. It’s expected to include:

• A weekly flat fee to cover administrative costs

• An investment management charge

2. How Much Tax Do Your Employees Have to Pay on Their Pension in Ireland?

Under the PAYE (Pay As You Earn) system, all occupational pensions and social welfare payments from the Department of Social Protection are subject to taxation. 

However, employees don’t have to pay USC (Universal Social Charge) and social insurance (PRSI contributions) on social welfare payments.

If your employee is above 66, they’re liable to income tax on their annual retirement income. 

The first part of their income is taxed at 20% based on the standard rate cut-off points, and the remaining income is taxed at a higher tax rate of 40%.

When employees retire, they can claim a portion of their pension as a tax-free lump sum (up to a specific limit), subject to certain conditions. 

But does everyone have to pay taxes?

In certain circumstances, such as if your employee is 65 or older and earns below a specific income level, they may be eligible for a total income tax exemption. 

This income level is called the exemption limit. 

• For individuals aged 65 and over, this limit is set at €18,000 per year. 

• For married couples (with at least one spouse aged 65 or above), the limit is €36,000 per year. 

Additionally, for couples with dependent children, this exemption limit increases with each child.

Learn more about Tax Relief on Pension Contributions in Ireland.

3. What Would Your Employees' Pension Amount be If They Didn't Have a Workplace or Private Pension Pot?

If your employees don’t have a workplace or private pension pot to support themselves in retirement, they can avail of the State Pension.

As of 2025, the maximum weekly rate of the State Pension (Contributory) is €289.30 (€15,043.60 per annum).

If they don't qualify for the contributory pension, they can avail of the State Pension (Non-Contributory). It’s paid at a weekly pension rate of €278 per week if the employee is under 80 years of age and at a rate of €288 per week if they’re 80 and above.

Offer Flexible Retirement Plans to Your Employees With Kota 

In Ireland, 53% of workers [7] don’t have access to an occupational pension because their employers don’t offer one.

As a result, most Irish employees become dependent on the State Pension, which isn’t sufficient to sustain them during retirement. 

Want to offer affordable and flexible pension plans for your employee’s welfare?

Try Kota.

Kota is a digital employee benefits app that allows employers to manage, pay, and scale your pension benefits globally from a single centralised platform.

With Kota, you can: 

• Enrol your staff in a compliant Irish Life pension scheme within minutes.

• Set matching employee and employer contributions.

• Give employees complete ownership of their pension.

• Automate pension provision to reduce extensive paperwork and administrative costs.

• Stay up-to-date on how your package competes locally with geo-based data.

Join Kota today and empower your people with our all-in-one digital pension app.  

Sources:

1. Pension Support Line IE - What is the average pension in Ireland?

• https://pensionsupportline.ie/what-is-the-average-pension-in-ireland/

2. Numbeo - Cost of Living Index by Country 2024

• https://www.numbeo.com/cost-of-living/rankings_by_country.jsp?title=2024

3. Statista - Core inflation rate in Ireland 1983-2024.

• https://www.statista.com/statistics/1363350/ireland-core-inflation-rate/

4. Irish Examiner - Price inflation falls below 2% as interest rates take their toll - 2024

• https://www.irishexaminer.com/business/economy/arid-41365786.html

5. Irish Examiner - Diageo to raise price of a pint by 6c in third hike in 18 months - 2024

• https://www.irishexaminer.com/news/arid-41361343.html

 6. Alone - ALONE Calls for the state pension and other social welfare payments to be benchmarked.

• https://alone.ie/alone-calls-for-the-state-pension-and-other-social-welfare-payments-to-be-benchmarked/

7. Central Statistics Office - Pension Coverage - 2024

• https://www.cso.ie/en/releasesandpublications/ep/p-pens/pensioncoverage2024/keyfindings/

8. Irish Examiner - You can retire well on 50% of your gross income - 2022

• https://www.irishexaminer.com/business/economy/arid-40977338.html

9. Morgan McKinley - 2024 Salary Guide Ireland

• https://www.morganmckinley.com/ie/salary-guide

10. Fidelity - How much do I need to retire - 2024

• https://www.fidelity.com/viewpoints/retirement/how-much-do-i-need-to-retire