The Investors Centre Ireland

Not for most people. The maximum State Pension (Contributory) is €277.30 per week or roughly €14,420 annually. That's barely above the poverty line and far below the average household spending of €50,000+ per year in Ireland.

The State Pension is designed to replace only 30-40% of pre-retirement income. If you're earning €60,000 annually, you'd need about €42,000 in retirement (70% replacement) to maintain your lifestyle. The State Pension covers just one-third of this. Financial advisors recommend having a pension pot of at least 10 times your final salary — so if you earn €60,000, aim for €600,000 in your pension fund. With employer contributions, tax relief at your marginal rate (up to 40%), and compound growth over decades, this becomes achievable through consistent pension contributions throughout your working life.

Global diversification is essential. The ISEQ is one of Europe's smallest stock markets, heavily dominated by just a handful of companies like CRH, Kerry Group, and AIB. Ireland represents less than 0.2% of global stock markets — investing only in Irish stocks leaves you massively under-diversified.

Even large Irish companies earn most revenue overseas. CRH generates over 90% of its business outside Ireland. By limiting yourself to the ISEQ, you're missing exposure to global tech leaders, healthcare innovators, and emerging market growth. A globally diversified portfolio spreads risk across thousands of companies, multiple sectors, currencies, and economies. Most Irish financial advisors recommend at least 80-90% international equity exposure — something the tiny ISEQ simply cannot provide alone.

Pensions offer better tax advantages for most people. Pension contributions get tax relief at your marginal rate (20%, 40%, or even 52% when including USC and PRSI), meaning the government is effectively paying up to half your contribution. Employer matching adds even more free money. Buy-to-let property faces mortgage restrictions, maintenance costs, vacancy risks, and rental income is taxed at your full rate.

Property also concentrates all your risk in one asset class in one country. If the Irish property market stalls (as it did from 2008-2014), your entire investment suffers. A pension invested globally spreads risk across thousands of companies and multiple economies. Plus, investment properties require hands-on management, while pensions are passive. Many financial planners suggest: max out pension contributions first (especially with employer matching), then consider property investment with surplus funds. The pension tax relief alone typically outweighs property returns, especially for higher-rate taxpayers.

Ireland's 41% exit tax makes ETFs less attractive than in other countries. ETFs and investment funds are taxed at 41% on all gains (not the standard CGT rate of 33%), with no indexation relief. Worse still, "deemed disposal" forces you to pay tax every 8 years even if you haven't sold — Revenue treats your gains as if you sold and rebought.

This means if you hold an ETF for 24 years, you'll pay exit tax three times on the same investment, significantly eroding compound growth. For this reason, many Irish investors either: (1) invest through pension wrappers where exit tax doesn't apply, (2) buy individual shares instead (which get the favourable 33% CGT rate), or (3) use investment bonds with life companies. If investing outside a pension, speak with a financial advisor about tax-efficient structures. The deemed disposal rule particularly punishes long-term buy-and-hold investors who would otherwise benefit most from compound growth.

Even €300/month can grow to over €350,000 in 30 years. At a 7% average annual return, you'd contribute €108,000 of your own money — but with tax relief at 40%, your net cost is only €64,800. The rest is compound growth, tax relief, and potentially employer matching.

Your tax-relievable limit depends on age: under 30 (15% of earnings), 30-39 (20%), 40-49 (25%), 50-54 (30%), 55-59 (35%), and 60+ (40%). On a €70,000 salary at age 35, that's €14,000 annual pension relief available. If you're a 40% taxpayer contributing €300/month (€3,600 annually), you get €1,440 back in tax relief, meaning your net cost is only €180/month. Employer matching effectively doubles this. The key is starting early: someone contributing from age 30 to 65 will accumulate far more than someone contributing double the amount from age 45 to 65, thanks to compound growth.

Note: These figures are for educational purposes only. Investment returns vary and past performance doesn't guarantee future results. Always consider your personal circumstances and consult a financial advisor.