pension that moves with you

[Pippa246]

Hi all. doing a bit of financial planning in our family - me, DH, DS (26) and DD (23). Me and DH are more or less sorted with regards to pension and DD is still studying (won't be in full time employment for about another year).

Looking for advice re DS - he is in full time employment but will be changing employer on a fairly regular basis for probably at least the next 10 years. In his current role, both he and employer are paying the minimum amounts into a pension. He is earning about £45k and will likely earn in this region for the next 5 years or so.

He has already bought his first home but is thinking about opening a LISA as part of his pension plans. I am wondering what is the best thing to do with regards to paying into a pension when a person will be frequently moving employer (both me and his dad are/were public sector employees and paid into the same scheme for our entire working lives more or less). I have read online that not all schemes will allow you to transfer in and there can be a cost to transferring in. Can anyone advise on a good approach for someone at the start of their career who will be changing employer frequently?

TLDR:
Is it always better to pay into employer pension scheme and move it when you change jobs OR
Is a LISA the best way to go for someone at the start of their career who will move around a lot?

Thanks!

Surely it's always better to pay into employer scheme as otherwise you won't get their contributions?

Well if he pays into a pension, he is getting an employers contribution and tax relief so it's nearly always a good idea. I assume it's a defined contribution scheme? They usually always take transfers in or he could leave it where it is and have more than one pot. (check charges though). DB schemes are trickier but depending on his job, he's unlikely to be in one of those nowadays.

@Fluffycloudsfloatinginthesky @saveforthat - yes its true about the employer contribution but the worry was any new scheme might not accept a transfer in or would charge for transferring in. I believe there is also a government contribution to personal pensions and of course, there is 25% added to the LISA each year so that is also a contribution of sorts.

@saveforthat - I wasn't aware DB schemes were rare these days - good to know most schemes do allow transfers.

his current employers scheme is the people's pension if that helps.

The PP is a DC pension. Transfer in charges are rare. Transfer out charges or penalties are more common but still unusual. Your DS should check with the PP what the options are if he changes employer and any charges.
There is a cap of £1000pa on the gov contribution to a LISA. Pensions give you the employer contribution and future employers may give more than the minimum and of course you get tax relief (at least 20%).

Thank you @saveforthat - very helpful to know

The LISA top up is just equivalent to the pension tax saving for a pension.
Eg if you put in £80 from gross salary as a basic rate taxpayer £100 will end up in your pension or LISA so both are a 25% top up. If a higher earner paying 40% and/or using salary sacrifice to also save national insurance then a pension is a much better option.
As others have said the company pension is a better option as employer will also need to pay in.

Thanks @TheOneWithUnagi - I didn’t think of the LISA add on as being equivalent to the tax saving.

I know the occupational pension is almost certainly always going to be the best pension saving scheme - my question was more specifically related to changing jobs a lot and thus potentially having to move the pension savings to different schemes.

I was concerned this might mean lots of transfer in/out charges or DS ending up with umpteen small pension pots.