Some brokers may give you misleading data in an attempt to make a sale,writes Laura Slattery

Over the next six weeks company-wide e-mails, personnel officers' memos and workplace presentations are likely to be dominated by the looming requirement for employers to provide staff with access to pensions.

Employees, particularly younger workers, could be forgiven for shifting uncomfortably in their seats during slideshow explanations of why they should buy Personal Retirement Savings Accounts (PRSAs).

But those who can afford to save for retirement and whose employer gives them no other option apart from a PRSA should probably try not to let their eyes glaze over at the mere mention of the p-word and look out for the following:

1. The person selling the PRSA is a tied agent.

This means they do not have to scour the market to search for the best PRSA available. They only sell on behalf of one company and cannot advise on the rest of the market.

Most independent brokers are multi-agency intermediaries, which means they can advise on all of the companies with which they hold agencies. Some PRSA providers, including AIB's life assurance subsidiary Ark Life and new pensions market entrant EBS, do not sell through brokers.

2. The salesperson infers that a standard PRSA is just a basic model with limited investment options and, to get higher returns, you will need to plump for a non-standard PRSA.

It is true that fund options available under non-standard PRSAs, for example with-profit funds or index tracking funds, are not allowed under rules for standard PRSAs.

But the Irish Financial Services Regulatory Authority (IFSRA) advises consumers to beware of promises of better returns on these funds.

"Predicting investment performance is notoriously difficult," its consumer fact sheet warns.

3. The salesperson says that, due to tax relief available on pensions, a PRSA will only cost you half of what you put into it.

This is roughly correct if you are a 42 per cent taxpayer. However, you will receive income tax relief at this rate up to certain limits. You will also get PRSI relief of 6 per cent if you contribute through payroll deductions, so for every €100 you contribute, it will only cost €52.

Mr Paul O'Neill of Cork-based intermediary J.P. O'Neill Financial Management says he knows of a recent case where an individual who earned just over €20,000 was told this, even though this salary placed him firmly in the 20 per cent standard rate tax band.

"One would hope it would be described as a deferral of tax rather than as a tax relief," adds Mr Liam Ferguson of www.prsacentre.com, "as 75 per cent of the accumulated fund will be taxable when they are drawing on it".

4. The person selling the PRSA says that putting aside just €100 into a pension "isn't really worth your while" and suggests higher contributions.

The agent or adviser is trying to get commission on the PRSA he or she is selling. Some companies - including Irish Life, Canada Life and Friends First - do not pay the brokers commission unless customers contribute a certain amount every month.

Put in what you can afford, says Mr Ferguson. "Your pension is your long-term savings fund. The more you put in, the more you will get out at the end but it has to take into account your personal circumstances."

Intermediaries, although not banks or insurance company sales agents, are required to do a factfind on clients, which includes determining what your monthly outgoings are and what priorities you have.

If you are in your 20s and you are saving for a deposit for a house, don't put so much into a pension that it jeopardises your ability to save, Mr Ferguson advises. "You could be putting at risk your chances of ever owning a house."

5. You already hold a personal pension plan or are a member of an occupational scheme but someone suggests that you abandon it in favour of a new PRSA.

You may be the victim of churning, where brokers or agents seek to earn commission by switching consumers from one pension plan to another.

The IFSRA recommends that people approached about switching to a PRSA "ask for details in writing as to why this would be the best course of action".

For example, if you hold a personal pension, you may already have paid front-loaded charges of 50 per cent in the first year and may be in line for bonuses as your fund grows. Switching to a PRSA may not represent good value, especially if you are close to retirement.

If you have been a member of a defined-contribution occupational pension scheme for less than 15 years you may transfer your benefits to a PRSA if you are leaving the company.

Otherwise it is generally better to stick with an occupational scheme.