She said they would usually get bigger returns - often much bigger - from contributing to their employer's pension scheme, and explained that the early encashment penalties are severe. I
f you cash in other than for a house purchase or after the age of 60, the penalty is 25 per cent. That is not just the government taking back the original 25 per cent subsidy, because the penalty applies to ALL the money, including growth, in the account.
She claims many providers aren't offering the new plan and won't do so because they are fearful about possible future claims against them.