{"id":247757,"date":"2025-07-08T10:31:11","date_gmt":"2025-07-08T10:31:11","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/247757\/"},"modified":"2025-07-08T10:31:11","modified_gmt":"2025-07-08T10:31:11","slug":"heres-how-to-close-the-gap-the-irish-times","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/247757\/","title":{"rendered":"here\u2019s how to close the gap \u2013 The Irish Times"},"content":{"rendered":"

*It\u2019s a no-brainer; the state pension <\/a>is currently worth about \u20ac15,000 a year, and is one of the few welfare payments governments always try to increase in the annual budget. <\/p>\n

And yet, women still lag behind men when it comes to receiving the weekly payment at the maximum rate. This means a poorer life in retirement. <\/p>\n

\u201cAll the inequalities<\/a> women face throughout their working life, such as lower average earnings and the gender pay gap \u2013 all of that is exacerbated in older age,\u201d says Donal Swan, women\u2019s economic equality coordinator at the National Women\u2019s Council of Ireland (NWCI).<\/p>\n

Indeed, while the gender pay gap may be of the order of about 10 per cent, the gender pension gap remains \u201cstubbornly\u201d high, at about 30 per cent. This means that the typical woman then has 30 per cent less of an income in retirement than a typical man.<\/p>\n

[\u00a0The motherhood penalty: \u2018Once they\u2019re in bed, you log back on at 9pm or 10pm and work\u2019Opens in new window<\/a>\u00a0]<\/p>\n

There have been positives on the pensions front of late, such as the introduction of the long-term carer\u2019s contributions scheme, which makes it easier for those who have been caring for long periods to qualify for a state pension.<\/p>\n

It is changing, says Tony Delaney, founder and CEO of SYS Financial, who notes that participation rates of women in the workforce have increased, which has a corresponding impact on state pension coverage rates.<\/p>\n

Moreover, the Government has committed, in the recent programme for government, to introducing changes to support women who fall outside the existing schemes to qualify for a state pension.<\/p>\n

But, while such tinkering is positive, \u201cit doesn\u2019t deal with the complexities of women\u2019s lives\u201d says Swan.<\/p>\n

Time to take some action then, to try to narrow this gap and ensure a brighter financial future for yourself.<\/p>\n

1. Check your entitlement <\/p>\n

The state pension is currently paid out at a weekly rate of \u20ac289.30. With women in Ireland living, on average, until around the age of 85, this could be worth over \u20ac300,000 to you at today\u2019s pension rate. <\/p>\n

If you don\u2019t have enough contributions for a full state pension, you might still qualify for a lower payment – anything from \u20ac72.40 a week upwards for those with a minimum of 10 years of PRSI payments.<\/p>\n

If you fall short of that 10-year (520 weekly PRSI stamp) minimum, you might qualify for a non-contributory pension. This is paid at a top rate of \u20ac278 a week but it is based on a means test and so will depend on your household\u2019s income. You could end up with a weekly payment substantially lower than the top rate. Figures from the Department of Social Protection show that it\u2019s still primarily women who get this payment. As of June 30th, there were 58,688 women recipients of this pension, or 59 per cent of claimants, compared with 40,993 men.<\/p>\n

It\u2019s clear then, that regardless of the rhythms of your working life, you need to maximise your chances of getting this payment at the top level.<\/p>\n

It\u2019s worth keeping track of how your contributions are stacking up. You can do this by requesting your record through MyWelfare<\/a>.<\/p>\n

2. Get 40 years of credits<\/p>\n

Increasingly, entitlement to an Irish State pension is being calculated on a total contributions approach (TCA). Introduced in 2018, it is now replacing the older \u201cyearly average\u201d approach on a phased basis and, by 2034, will be the only way state pension entitlement is calculated. <\/p>\n

If you were born after September 1st, 1946, you can opt for this approach. And if you were born after 1968 (now aged 57 or less), your pension will automatically be based on the TCA. But what will this mean?<\/p>\n

Well, in short, to qualify for a full state pension under the new regime, you will need 40 years\u2019 contributions (2,080 or more PRSI contributions). In other words, you need to be working from at least 26 through to the State pension age of 66 to qualify.<\/p>\n

You can get credits for periods spent in the home caring for children (through the HomeCaring Periods<\/a> scheme, for example, see below), but such contributions cannot exceed 20 years.<\/p>\n

So, let\u2019s say you have just 20 years of contributions; you\u2019ll qualify for 50 per cent of the maximum pension, or \u20ac144.65 a week instead of \u20ac289.30, a substantial decrease on the top rate.<\/p>\n

The NCWI would like to see the time period lowered, so that you can access the full state pension based on 30 years of contributions. <\/p>\n

\u201cWe\u2019re hopeful we can keep pushing Government and the Department [of Finance] to keep making changes where possible, to expand people\u2019s access to this,\u201d says Swan.<\/p>\n

3. Make sure you get credits for time out<\/p>\n

If you take time out of the workforce (for maternity or parental leave), your employer may continue to make pension contributions on your behalf. <\/p>\n

But what happens to your state pension?<\/p>\n

When it comes to the state pension, if you\u2019re not getting paid while on leave, then you won\u2019t be paying PRSI, which means you won\u2019t be building up credits for your state pension.<\/p>\n

Under the new regime, however, parents who take time out to care for their children can keep their PRSI record intact by applying for credits under the aforementioned HomeCaring Periods Scheme.<\/p>\n

If you get maternity benefit, you will get credits automatically. However, as this ends after 26 weeks, if you take a further 16 weeks\u2019 unpaid leave you will need to get your employer to complete the application form for maternity leave credits when you return to work.<\/p>\n

When it comes to parental leave, you should also be entitled to credits \u2013 but, again, you have to make sure your employer applies for these. Parents can take up to 26 weeks of parental leave, which is typically unpaid, for each child up to the age of 12. <\/p>\n

4. Time out is good \u2013 but get back in the workforce if you can<\/p>\n

So far so good, but complications with getting the credits can arise if you subsequently opt to take a longer period of time out of the workforce. <\/p>\n

This is because, to qualify for a state pension \u2013 even at a reduced rate \u2013 you will need at least 10 years\u2019 paid contributions, and your home caring years can\u2019t exceed 20. And to get the full pension, you will need 40 years of contributions. <\/p>\n

So then, it may make sense for many women to return to the workforce once their children are grown up, to try to meet the requirements for a state pension.<\/p>\n

5. Think about topping up your state pension<\/b><\/p>\n

Many stay-at-home parents turn to ad hoc work to boost their income while looking after their family \u2013 running a house account on Instagram is one such route, as is running a play group or after school activity.<\/p>\n

However, while family friendly, it\u2019s important to note that such earnings may not be working towards a state pension for you. <\/p>\n

If you are self-employed and earn less than \u20ac5,000 a year, you won\u2019t be paying S-class PRSI contributions, which means that you won\u2019t be building up a state pension record. <\/p>\n

But you can become a voluntary contributor. How much this will cost will depend on the class of the last PRSI payment made by you or credited to you. <\/p>\n

If it was class A – the most common for PAYE workers, you will be required to pay 6.6 per cent of your income in the previous tax year, with a minimum payment of \u20ac500.<\/p>\n

For those who were most recently paying PRSI as a self-employed person, there is a flat annual rate of \u20ac650 (up from \u20ac500 to October 2025, and from \u20ac253 until 2013). This will boost your entitlement to a state pension.<\/p>\n

The challenge here, however, as Swan notes, is that if you\u2019re already on a low income, you may not have enough money to make these lump sum voluntary PRSI payments. However, you can apply to pay in quarterly or half-yearly instalments during the contribution year. <\/p>\n

And, from a household perspective, it may make financial sense to get your partner, who may be working, to make the payment. <\/p>\n

You will need to have made 520 paid contributions (ie 10 years) to qualify to make voluntary contributions in the first place. You can apply online using the Voluntary Contributions Application Form (VC1)<\/a>.<\/p>\n

6. Remember you may qualify for a pension through your spouse<\/p>\n

If you are married but don\u2019t qualify for a pension in your own right, you may be entitled to get an increase on your spouse\u2019s pension, known as a \u201cqualified adult\u201d pension. This is offered at a lower rate of up to \u20ac259.40 a week.<\/p>\n

However, the payment is means tested, and some women may struggle with the concept of being dependent on their partner in retirement. They may also feel that their contribution to society is not being recognised.<\/p>\n

\u201cIt\u2019s a real remnant of the era of that male breadwinner model,\u201d says Swan. <\/p>\n

Indeed, until as recently as 2007, the \u201cqualified adult\u201d payment went straight to the person claiming the state pension, so the spouse \u2013 in most cases a woman \u2013 had to then rely on their husband to give them the money.<\/p>\n

Instead, a bit like the current basic income scheme, which is being trialled<\/a> among artists, the NWCI would like to see the introduction of a universal pension.<\/p>\n

While potentially costly, last year, Social Justice Ireland said the introduction of such a scheme could be funded by reducing the higher rate of tax relief on private pensions from 40 per cent to 20 per cent, and by increasing employers PRSI by 0.5 per cent.<\/p>\n

\u201cIt would be a significant structural change,\u201d says Swan, who adds that the current tax relief is \u201cdisproportionately more valuable to men\u201d.<\/p>\n

\u201cThe way everyone contributes to society through their life is different,\u201d he says.<\/p>\n

*This article was edited on Tuesday, July 8th, 2025<\/p>\n","protected":false},"excerpt":{"rendered":"*It\u2019s a no-brainer; the state pension is currently worth about \u20ac15,000 a year, and is one of the…\n","protected":false},"author":2,"featured_media":247758,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3093],"tags":[51,474,28728,7220,67725,2074,2499,95912,16,15],"class_list":{"0":"post-247757","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-finance","10":"tag-for-you","11":"tag-gender-equality","12":"tag-gender-pay","13":"tag-pension","14":"tag-personal-finance","15":"tag-the-juggle","16":"tag-uk","17":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/114817157294287004","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/247757","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=247757"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/247757\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/247758"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=247757"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=247757"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=247757"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}