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Regular job movers can keep pension plans


People who change jobs regularly will now no longer have to cash in or move their workplace pension, under new government plans.
Some 20,000 employees a year, who move jobs after being in a company for less than 2 years, are usually given a “short service refund” of their pension contributions. This can be optional, but companies have the power to insist this option is taken. The government plans to change the rules to refunds only being available for people who have been in schemes for less than 30 days.

The typical size of a pension pot when this refund is taken is between £1,000 and £2,000, of which the employee contributions (and so the refund) is typically about £625.

The latest changes come after a survey by consumer group Which? found that confidence in the pensions industry remains low, despite the new reforms brought in by the conservative government.

Pensions Minister Steve Webb said this reflected the reality of work when the average employee had eleven different jobs in a lifetime. He said:
"If people change jobs regularly and 'cash out' their pension each time, they stand no chance of building up a decent pension pot"

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