Workplace pensions - changes in personal circumstances
When you have a workplace pension, you should think about what will happen if your circumstances change. What seems affordable at one point in your life may become expensive later. Find out how a change at work or home may affect your workplace pension.
Changing jobs and your pension
Most people move jobs several times during their working lives. When you change jobs your pension belongs to you.
If you change jobs and enrol in a new workplace pension, you might be able to join your old pension with your new one. Your new pension scheme provider can tell you if this is possible.
If you change jobs and pay into your former workplace pension, you might not get some of the pension scheme's benefits. Some benefits are only available to an employer's current workers. If you stop paying into the scheme, you'll still get that pension when you reach the pension scheme's age.
If your workplace pension is a defined contribution pension scheme your pension fund will continue to be invested. You will receive yearly statements and forecasts on how it is performing.
If your workplace pension is a defined benefit pension scheme, your benefits will be revalued regularly to keep up with inflation.
If you aren't sure about your workplace pension scheme benefits or what the scheme allows, ask the pension scheme provider for information.
You leave your job to become self-employed
Your employer will stop paying into your workplace pension but you may be able to make pension contributions after you leave your job. Contact the pension scheme provider to find out if this is possible, if there's a cost involved and if you will get tax relief.
You might want to set up a personal pension for your retirement. You could choose a personal or stakeholder pension available from various pension providers. Alternatively you may wish to use the National Employment Saving Trust (NEST). NEST is a workplace pension scheme open to employers and self-employed people.
You should seek independent financial advice which is available on the Money Advice Service website. The Pensions Advisory Service provides general, free information about pensions.
If you move house
It is important to tell your pension scheme provider when you change address. This will make certain that you receive information about your pension.
If you die before retiring
It is important to think about what would happen to your workplace pension if you died before retirement. You may be able to nominate someone to receive the money if you die.
If you nominate someone, your pension scheme provider should ask you to confirm in writing who that person is. If they don’t do this when you first join the pension, you should ask them for a nomination form. You can change your nomination at any time. If your circumstances change, you should tell the pension scheme provider.
In most cases the money will go to whoever is nominated. But organisations which run pension schemes are allowed to pay it to someone else if necessary. For example, if the person nominated can't be found or has died.
Taking money out of your pension before you retire
You cannot usually take money from your pension scheme until you are at least 55, unless you're seriously ill. The exact age you can take your pension depends on the scheme rules. Ask your pension scheme provider about their pension rules.
Maternity and other parental leave
You and your employer continue to make pensions contributions if you are getting paid during maternity leave. If you are not getting paid, your employer doesn’t have to make pension contributions unless your contract provides for this. Check your employer’s maternity policy.
Paid leave
When you take paid leave, you and your employer continue making pension contributions.
The amount you contribute is based on your actual pay during this time. Your employer's contributions are based on the salary you would have received if you weren’t on leave.”
Unpaid leave
When you take unpaid leave, you may be able to make pension contributions if you want. Check with your employer or the pension scheme provider.
Pension Tracing Service
It’s important to keep track of your pensions. Keep your pension statements. If you have lost track of a pension, the government’s Pension Tracing Service could find contact details for the lost pension.
Further information
For more information Money Helper provides independent advice about pensions, bank accounts, investments and debt