Most people think building a €1 million retirement fund in Ireland is impossible without winning the lotto or taking big risks. But the truth is, with the right system, it’s not only possible — it’s achievable for many high earners, business owners, and diligent savers.
In this guide, I’ll break down the exact framework I use (and help my clients use) to reach €1 million in retirement savings:
How much you actually need to save
The Irish tax breaks that supercharge the process
The role of compounding and time
How to structure your money so it works for you, not against you
Why €1 Million Matters
€1 million sounds like a lot. But in retirement planning, it doesn’t always stretch as far as people think.
Why?
We’re living longer — 25 to 35 years in retirement isn’t unusual.
Costs rise faster than inflation.
The State Pension may not keep up.
And financial freedom isn’t just covering bills. It’s about living the life you worked hard for.
Example: Barry & Fiona Murphy
Both aged 60, aiming to retire at 65.
Projected to have €1 million in pensions.
They take a €270,000 tax-free lump sum, giving €150,000 to their daughters to help buy homes.
That leaves €850,000 invested.
They want €64,000 a year in retirement.
If they live to 95, they still leave behind around €345,000 (roughly €122,000 in today’s money) as part of their estate.
Now compare that to relying only on the State Pension — currently about €15,000 per person, or under €30,000 for a couple. That’s less than half of Barry & Fiona’s target income.
The lesson: a €1 million pot doesn’t make you “rich.” It gives you choice, control, and security.
Step 1: Build the Savings Engine
The journey starts with your savings engine. Income minus spending equals surplus cash. The bigger the surplus, the faster your journey.
A helpful rule I use (inspired by Money with Katie’s Spending Rule) is:
Spending = (After-tax income + 4% of investable assets) ÷ 1.75
Whatever’s left becomes your savings engine.
Example 1:
Income: €100,000 gross → €60,000 after tax
Investable assets: €200,000
4% of assets = €8,000
Add to income = €68,000
÷ 1.75 = €39,000 spending target
Leaves ~€21,000 for saving
And here’s why it matters:
Save €15,000/year at 6% → €1m in ~30 years
Save €30,000/year → ~20 years
Save €40,000/year → ~18 years
Your savings rate determines your timeline.
Step 2: Maximise Tax Efficiency
This is where Ireland gives you a huge advantage: pensions.
At the higher tax rate, every €1,000 you contribute only costs you €600. That’s a 40% boost upfront.
Worked Example:
Contribute €10,000 gross → €6,000 net after relief
Inside a pension, it grows tax-free
Over 20 years at 6%: €10,000 grows to €34,000
Outside a pension, €6,000 grows to €20,000 (before tax)
Both cost €6,000 out of pocket. But the pension leaves you with ~70% more.
Add employer matching, and it’s even more powerful. A 5% employer match is essentially free money.
Contribution Limits
Revenue caps contributions for tax relief:
20s: 15% of income
30s: 20%
40s: 25%
50s: 30%
60s: 40%
Always subject to a max income of €115,000.
If you’ve maxed out your pension, surplus savings can go into ETFs, funds, or property — but remember, outside pensions you’ll need to manage risk tapering yourself.
Step 3: Invest for Growth & Compounding
Saving alone won’t get you to €1 million. Investing is essential.
The difference:
Save €30,000/year in cash at 1% → ~€840,000 after 25 years (worth ~€520,000 in today’s money).
Invest €30,000/year at 7% → ~€1.9 million.
That’s the power of compounding.
In the first 10 years, growth looks modest. But in years 20–25, the curve steepens and the gains explode.
The two keys:
Consistency (keep adding every year).
Patience (stay invested through downturns).
Beware of fees:
A 1% higher annual fee can quietly cost you €300,000+ over 25 years. In Ireland, some funds still charge over 1.5% AMC. Always check your options and aim for low-cost, diversified funds.
Step 4: Behaviour & Consistency
This is where most people fall down.
Lifestyle creep: spending rises with income.
Lack of automation: saving “what’s left” rarely works.
Emotional investing: panic-selling resets the compounding clock.
The solution?
Automate contributions.
Review investments annually, not weekly.
Stick with the plan through dips.
Wealth isn’t built by chasing returns. It’s built by sticking to a repeatable system for long enough.
The €1M Framework You Can Copy
To recap, here’s the system:
Build your savings engine – create surplus cash every year.
Maximise tax efficiency – use pensions as your rocket fuel.
Invest for growth – let compounding work for you, while keeping fees low.
Stay consistent – avoid lifestyle creep, automate, and stay the course.
Follow these steps, and €1 million stops being a dream. It becomes a system.
Final Thoughts
Building a €1 million retirement plan isn’t about luck or risky bets. It’s about:
Aligning your savings rate with your goals
Using Ireland’s pension system to your advantage
Letting compounding do the heavy lifting
And managing your behaviour as much as your money
If you’d like to see how this framework applies to your own finances, I offer private strategy calls. We’ll build a personalised model of your income, pensions, and investments — and design a roadmap to your financial freedom.
And remember: getting to €1 million is only the first step. The real question is: how do you make it last?
I empower people to take full control of their finances, guiding them step by step towards building, growing, and preserving true wealth.
About the Author
Kevin Elliott is a Financial Planner and quantitative finance expert with over 18 years of experience in global financial markets. He has worked with top-tier institutions such as Bank of New York, Bridgewater Associates, RBS, CIBC, UniCredit, and Bank of America, where he served as Director in New York.
Holding a BSc in Economics and Finance and a Graduate Diploma in Financial Planning from University College Dublin, along with an MBA from Imperial College London, Kevin combines deep technical expertise with a passion for personal finance and wealth building.
Kevin is committed to helping individuals take control of their finances, invest wisely, and build long-term wealth. With a knack for simplifying complex financial concepts, he provides actionable insights on investing, retirement planning, and financial independence.
Whether you’re a beginner looking to start your wealth journey or a seasoned investor fine-tuning your strategy, Kevin offers practical guidance, expert analysis, and proven strategies to help you achieve financial freedom and security.
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