What happens to your pension when you leave a job?

When you move on from a job, it’s not just memories you take with you: there's also the matter of your workplace pension. 

Understanding what happens to this pension is crucial for keeping your retirement savings on track. Just like a plant needs to be cared for to grow, your pension needs attention to ensure it continues to thrive, even when you’re no longer with the same employer.

Workplace pensions are a key way to save for your retirement, with contributions from both you and your employer. 

Pension contributions

Each time you get paid, a portion of your salary automatically goes into your workplace pension pot. The good news is, your employer adds to it too, potentially boosting your savings further. Plus, you can get tax benefits, meaning more of your money goes into saving for the future instead of going to taxes. However, it’s worth noting that tax benefits can be subject to change.

The value of your pension can go down as well as up, you could get back less than has been put in. However, pensions should still be a part of your retirement plan, as they can be a great way to save for the future.

Different types of workplace pensions

Workplace pensions can be broadly split into two main types, each working differently in terms of how your retirement income is calculated:

• With a defined contribution pension, the amount you get when you retire depends on how much is paid in and how investments perform. Both you and your employer add money to the pot, and with the potential to grow over time.
• Defined Benefit Pensions guarantees you a certain income when you retire, based on your salary and how long you’ve built up benefits within the scheme. 

Leaving your job doesn’t mean leaving your pension behind. You’ve got options to manage old workplace pensions effectively.

Finding lost pensions from past employers

If you’ve lost track of an old pension, you can find out more about tracing your pension to find it again. It’s a free service that can help you find the details of pensions you may have forgotten about.

You can also contact your past employers to see if they have any of your pension details on file.

Combining multiple pensions into one

Combining your pensions into one pot could make it simpler to manage your retirement savings. It could also have other advantages, such as potentially lower charges and could also make tracking your investments easier. It's important to consider charges, benefits and investment choices before combining any pensions.

Our Find and Combine service is a great starting point. 

If you’re unsure about combining your pensions. You can read more about combining your pensions here.

Transferring an existing pension from a previous job

If you had a defined contribution pension you’ll have some options for transferring it. You may be able to move it into your new employer’s scheme or you could place it in a personal pension. 

Having fewer pensions can make managing things easier, but its important to consider the charges, funds and any valuable benefits which could be lost before deciding to transfer. 

If you’re interested in transferring your workplace pension which is currently receiving contributions, you should firstly consider checking your employer’s policy to see if this option is available to you. You can also transfer your pension to a new or existing Aviva pension with our Pension Transfer service.

It’s worthwhile speaking to a financial adviser if you're not sure about whether combining or transferring pensions is a viable option for you. Please note that there is a charge for this service.