Many people in Ireland think the smart move with a pension is to join the work scheme, let the money accumulate monthly, and leave it alone to grow.

Sounds reasonable, right?

But here’s the thing — leaving your pension on autopilot could mean missing out on serious long-term growth. And when it comes to your retirement savings, that’s not something you want to ignore.

The Issue with Default Pension Funds in Ireland

Most workplace pensions in Ireland automatically invest your contributions into what’s called a default fund. These are designed to be low-risk and generally fall under the “lifestyle” category.

That means:

• Early in your career: a bit more aggressive (stocks/equities)

• Closer to retirement: shifts to safer, lower-growth assets

While this aims to protect your fund as you age, the trade-off is lower growth potential — especially when you’re younger and can afford more market volatility.

Let’s Talk Numbers: Why Growth Matters

We’re talking average returns of 3–4% annually with lifestyle funds.

But compare that to growth-focused pension strategies delivering 7–8% per year. The difference? Significant.

Example:

• Monthly contribution: €300

• Duration: 30 years

• Return at 4%: ~€210,000

• Return at 7%: ~€340,000

That’s a €130,000 difference — just by reviewing how your pension is invested. Curious? Use this Pension Calculator by Zurich to see how your returns stack up.

Inflation: The Silent Pension Killer

Even if your fund earns 3–4%, inflation in Ireland historically averages around 2% — but can spike, like the 9.6% peak in June 2022, according to CSO.ie.

What does this mean?

Your “growth” is nearly cancelled out by inflation. In real terms, your pension is barely moving forward.

This is especially true if you don’t review and rebalance over time.

What You Can Do: Review, Rethink, Rebalance

Your pension isn’t a slow cooker — you can’t “set it and forget it.” It needs a bit of ongoing attention.

Here’s how to take action:

• Get a pension review from a financial advisor
• Understand where your money is invested
• Consider switching to a more active growth strategy
• Don’t rely solely on your employer’s default

Talk to a Financial Advisor in Ireland You Can Trust

Getting help doesn’t need to be complicated or intimidating.

Stephen Donnelly at Donnelly Financial Planning can:

• Review your pension in plain language
• Explain your PRSA, AVCs, and other pension options
• Ensure your investment matches your long-term goals
• Handle all the paperwork and fund switching for you

Learn more about our Investment & Pension Services

Conclusion: Your Pension Deserves More Than Autopilot

Your pension won’t magically improve with time. But a quick review today could be worth thousands in the future.

Don’t let “set and forget” hold you back from the retirement you deserve. Take control now — your future self will thank you.

 

Warning
*Past performance is not a reliable guide to future performance.
*The value of your investment may go down as well as up.
*Your investment fund may be affected by changes in currency exchange rates.
*If you invest, you may lose some or all the money you invest.