Can I access my Pension before age 60 if I am unable to work due to illness?

I was recently asked this question by a business owner in his early 50’s. He was fortunate enough to have built up quite a large pension fund and wanted to know if he could access his pension fund before age 60 if he was unable to work due to illness.

The short answer is probably not. There are so many criteria that have to be satisfied (criteria which are specified by Revenue) that in practical terms accessing a pension before age 60 is almost impossible.

The definitions of ill health which might allow early access to a pension are very strict. One of the definitions for example is that it requires the individual to be ‘permanently incapable through infirmity of mind or body of carrying on his or her own occupation or any occupation of a similar nature for which he or she is trained or fitted’. To even have a chance of satisfying the illness criteria in this context the nature of the illness would have to be very severe, with no chance of the individual ever returning to work, and even then the chances of a successful claim for early access is slim.

I would recommend that if this issue is important to you, you should have a separate tailored income protection policy in place. An income protection policy can pay you up to 75% of your income each year for as long as you are unable to work due to illness or injury.

My advice would be to keep your pension plan in place for the purpose for which it was intended, your retirement, and set up an Income Protection policy to cater for ill health before retirement.

If you have questions, please feel free to contact me using the contact details listed below.

Michael Coburn BBS, QFA, FLIA, LCOI, RPA, SIA

Dublin: 01 5267770
Wexford: 053 9110380