Securing a "job for life" used to be the most important turning point in any career path, with school or college-leavers encouraged to find a good pensionable job and stick with it for decades.
These days, because most people don't manage to string together a 40-year run in one place of employment, saving for retirement has become a lot more complicated.
So what are your pension options if you leave your job?
• If you have been a member of an occupational pension scheme for less than two years when you leave the scheme, you will receive a refund of your contributions. However, you will lose the value of the contributions the employer has made to the scheme.
• If you have been a member of an occupational pension scheme for two years or more, you are entitled to "preserved benefits".
This means you will not lose the employer contribution, but you will not have access to either set of contributions until you retire. If you leave the money invested in the scheme, it will generate a small pension.
In a defined-contribution pension scheme, the preserved benefit must equal the accumulated value of the contributions paid by the member and the employer since the date the member joined, less any expenses.
In a defined-benefit scheme, a particular formula is used to calculate the value of the preserved benefit.
• The preserved benefits can be left where they are.
However, early leavers also have the right to opt for a transfer payment to: another occupational pension scheme of which they are becoming a member; an investment contract called a buy-out-bond; or an approved personal pension sold by an insurance company.
The value of the transfer may be adjusted downwards if a person is moving their contributions from a defined-benefit scheme that is failing to meet minimum funding standards.
This is in order to ensure that transfers out of a scheme do not financially disadvantage the people left behind.
Where people are not transferring to a new defined-benefit scheme, they may be better off keeping their contributions in the old scheme, because their ex-employer will guarantee to pay a certain level of pension based on salary and length of service.
• In theory, early leavers also have the right to transfer the payment into a Personal Retirement Savings Account (PRSA), as long as they have not been a member of the scheme for more than 15 years.
But, in practice, they may find it impossible to find a PRSA provider who will accept a transfer, unless they themselves pay for the actuarial certificate required to prove that they will not lose out by transferring.
