Explainer: What is an auto-enrolment pension?

What is auto-enrolment?

Auto-enrolment is a new pension savings scheme for certain employees who are not paying into a pension. They will be automatically included in the scheme but can opt out after six months.

The introduction of the Auto-Enrolment Retirement Savings Scheme, called My Future Fund, started on January 1, 2026. Under the scheme, the employee, employer, and Government all pay a certain amount into the employee’s pension fund.

A new public body, the National Automatic Enrolment Retirement Savings Authority, NAERSA, has been set up to administer the auto-enrolment scheme. The scheme is supervised by the Pensions Authority.

Who will be automatically enrolled?

You will be automatically enrolled in the new pension scheme if you are an employee and:

You are aged between 23 and 60

You are not currently part of a pension plan

You earn €20,000 or more per year

If you previously contributed to a pension but now do not, and meet the other conditions, you will be automatically enrolled.

If you earn less than €20,000 per year, or you are not aged between 23 and 60, you can choose to join the pension scheme if you are not already part of a pension plan.

Does my employer have to participate?

If your employer does not meet their auto-enrolment obligations, they will be subject to penalties and possibly to prosecution. If they don’t make contributions on your behalf, they may be fined and have to make repayments with interest. However, there are no plans to force employers to contribute to personal pensions.

What happens if I already have a workplace pension?

You will not be enrolled in the new auto-enrolment scheme if you are paying into a workplace pension plan.

What happens if I change jobs after being enrolled?

If you change jobs after being automatically enrolled, you won’t need to change pension or join a new scheme. You will remain a member of the auto-enrolment scheme on a ‘pot-follows-the-member’ basis. You won’t have to do anything, as the new National Automatic Enrolment Retirement Savings Authority will manage the change.

Is auto-enrolment better than my personal pension?

Whether auto-enrolment or your personal pension is better for you depends on your situation and circumstances. You should review your personal pension and compare it with the benefits of auto-enrolment to see what works best for you.

Can I opt-out of (leave) the pension scheme?

After you are enrolled, you must stay in the pension scheme for at least six months. You can opt out after six months but before you have been in the scheme for 8 months. Your contributions will be refunded.

Can I suspend my contributions?

You can also suspend (pause) your contributions at any time after the first six months. All contributions, including those from you employer and the State, will be suspended. All the existing contributions in your fund are kept there until you start making contributions again.

If you suspend your contributions, you must wait at least 12 months before you can start making contributions again.

What happens to my savings if I opt-out?

Contributions that are not refunded, including those made by your employer and the Government, stay in your savings pot and will continue to be invested.

If you stop working or move abroad at any time before retirement, you will stay enrolled, but will not make additional contributions. Your existing savings will continue to be invested. This means you can still access a pension pot at retirement.

If you leave the plan or suspend your contributions, you will be automatically re-enrolled after two years if you are still eligible for the scheme. However, if you are making contributions to another pension plan through your employer’s payroll, you will not be re-enrolled for that employment.

How much do I pay?

The amount you pay will be a set rate of your annual salary. Your employer will match your contributions, and the Government will contribute an additional amount. You cannot pay more or less than the set rate. You and your employer will pay 1.5% of your annual salary in the first year. This will increase to 6% by year 10.

Here are the rates you, your employer, and the Government will pay:

• Year of the auto-enrolment scheme: 1-3 - employee contribution rate, 1.5%; employer pays, 1.5%; Government pays, 0.5%.
• Year of the auto-enrolment scheme: 4-6 - employee contribution rate, 3%; employer pays, 3%; Government pays, 1%.
• Year of the auto-enrolment scheme: 7-9 - employee contribution rate, 4.5%; employer pays, 4.5%; Government pays, 1.5%.
• Year of the auto-enrolment scheme: 10 and after - employee contribution rate, 6%; employer pays, 6%; Government pays, 2%.

Where can I get more information?

You can watch the Department of Social Protection’s videos on auto-enrolment and read its information on auto-enrolment at https://www.gov.ie/en/department-of-social-protection/campaigns/auto-enrolment/

You can email autoenrolment@welfare.ie for more details.

Further information on this and other topics is available from Cork City Centre CIC in Cornmarket Street, open to the public on Mondays, Tuesdays, Thursdays and Fridays from 9.45am to 12.30pm and Wednesdays from 2pm to 4pm, Tel 0818 07 6950 (Lines open Mon-Fri 10am-4.30pm).