Pensions can feel like a mystery. There’s a pile of paperwork, some tax jargon, and a sense that you’re meant to ‘have one’ but not really know what it is. So let me put it in terms we can all understand – pensions are like shoes.
Stick with me here. Everyone needs them eventually. The right pair supports you, carries you through life, and keeps you steady when the road gets bumpy. But the wrong ones? They rub, fall apart, or don’t get you where you want to go. It’s not about what’s trendy or what your neighbour’s wearing, your pension, like your shoes, should fit ‘you’.
Let’s start with picking the ‘type of shoe’ because that’s like picking the ‘type of pension’. There are runners, heels, boots, sandals, wellies, you name it. In pensions, you’ve got PRSAs, occupational pensions, executive pensions, personal pensions. Each one suits a different lifestyle or stage of life.
If you’re self-employed, a PRSA might be your comfortable, reliable runner. Flexible, easy to manage, works with your pace. If you’re employed and your company has a pension scheme, that could be more like a sturdy boot: structured, built-in support, designed to carry heavier loads with employer contributions on top of your own. Executive pensions? Think designer heels, stylish and tax-efficient, but you want to know they’re properly structured, so you don’t topple over.
Then comes the ‘brand’ and that’s your ‘investment provider’. Just like with shoes, some brands are known for durability, others for flashiness, and some are just plain overpriced. In pensions, this is where your money actually goes, whether that’s with Zurich, Irish Life, Aviva, New Ireland, or any of the others. It matters. You want a provider that aligns with your goals, has strong performance, and charges fair fees. You wouldn’t buy a pair of shoes without checking the price tag, and pensions are no different. Always ask what you’re paying for and what kind of service comes with it.
Now let’s talk ‘colour’, this is the fun bit. In the pension world, the colour of your shoes represents ‘how diversified your investment is’. A plain black pump might be your very low-risk cash fund. A bright, funky rainbow trainer might be a more adventurous multi-asset fund. The more diversified, the more colours you’ve got, meaning your money isn’t all relying on one thing. If one area of the market takes a hit, another might balance it out. Diversification, like a good colour palette, keeps things balanced and interesting.
But just like in real life, some people panic and grab a pair of shoes they’ve never worn before, because someone told them they ‘should’. Maybe it’s a high-risk fund that’s too volatile for your comfort, or a super safe one that won’t grow fast enough. Either way, you end up with a shoe that doesn’t suit the road you’re walking.
And don’t forget the ‘fit’. This is where your personal circumstances come in: your income, age, retirement plans, and comfort with risk. You wouldn’t wear the same shoes at 25, as you would at 60 (well, you ‘could’, but your knees might protest). Same with pensions. What works in your 30s might need a tweak in your 40s or 50s. A good financial advisor will help you adjust the fit, as your life changes.
It’s also worth checking your ‘shoe rack’ every now and then. You might have pensions from old jobs sitting there collecting dust. They might be the wrong size now, or worse, you might have outgrown them altogether. Don’t let your money sit in an old, neglected shoe box. Review your pensions, see where they’re invested, and make sure they still support your long-term walk into retirement.
And let’s not forget those who haven’t bought their shoes yet. You’d be surprised how many people are walking barefoot – no pension, no plan, just hoping for the best. The sooner you start, even with a small contribution, the better your comfort level down the line. Starting in your 20s or 30s gives your money more time to grow. But if you’re only lacing up in your 40s or 50s, it’s still worth every cent. It’s not about perfection, it’s about progress.
Lastly, like any decent shoe, your pension should grow with you, flex where needed, and give you the freedom to move with confidence. It’s not about being an expert or having it all figured out, it’s about having the right tools under your feet.
So, if pensions have felt stiff, uncomfortable or just something you’ll ‘get around to’, take this as your nudge to pop in and try a few pairs on. You deserve a future that feels as secure as your favourite runners and trust me, finding the right fit now will save you a world of discomfort later.
