The world has changed a great deal since our parents’ days. Back then, it was common for someone to start working for a company when they left school or further education and still be employed by them at retirement. Keeping tag on your pensions was easy – you only had two, the company’s and the state pension. Maybe you also had a personal pension, but there was very little chance of losing track of any of them. Times have changed, and the pension market has changed too.
Throughout our lifetime we may move jobs many times, that could lead to a lot of pensions to remember, let alone keep track of. Often, eligible employees are automatically set up with a company pension, so may only be vaguely aware they are paying contributions.
It may only be as retirement appears on the horizon that you realise you are not sure how many pensions you have, where they are, or what state they are in. You shouldn’t worry; there are ways and means of discovering where your contributions have gone and what you can expect at retirement. You may even have time to consolidate various pension pots into a single pension.
Personal and Previous Employment Pensions
Generally, all pension providers to whom you have made contributions in the past have to send you a statement once a year. However, there may be reasons why you don’t receive them, particularly if you have moved several times during your working life. It is very easy to forget to update your address, or update an email address if you receive them digitally, and lose track.
So, how do you go about finding all your pensions? There are a few different methods, so let’s take a look at them.
Contact Previous Employers or Providers
Your first port of call is to contact your employers (if they still exist) or the pension provider. Your National Insurance number is the key, but you should also include your name, address, telephone number, date of birth, and other relevant information. This may include the approximate date it was set up and the plan number if you have it. The more information you give, the more likely they are to be able to help.
If you can make contact, you should be able to find out the relevant details:
- How much it is worth
- What has its growth been like recently
- What your options are when you reach 55
- How to transfer the pension pot to another provider and what the charges are, if any
However, it’s likely that if you’re reading this article, you have no details of your pension. Maybe your employer retired, was bought by another company, or no longer exists. If that’s the case, don’t fear. There are services available to help you.
The Pension Tracing Service
The Pension Tracing Service was set up by the government for just this situation. It is a free service that allows you to search a database of more than 320,000 pension scheme contact details. Figures from the Pensions Policy Institute suggest there may be something over £20 billion in unclaimed pension savings, so if you think you have lost a pension, this may be the place to start.
It is simple to use and you will receive the results of your search immediately. You just have to select the type of pension you are looking for and fill in detailed information such as the pension provider’s name or the employer’s name. The service will give you the contact details. This leaves you free to write or email your pension scheme provider directly.
You can find out more here: The Pension Tracing Service.
How Do I Move or Consolidate My Pensions?
So you’ve put the time in, and you’ve tracked down those lost pensions. Great! Now that you know where your money is, it’s time to think about whether you want to move them to consolidate or, ideally, get them to work harder for you. So, how do you go about this?
First, it’s a good idea to take a look at your current pensions and find out:
- Will there be fees to pay if I move? Sometimes an exit fee will be charged. These charges can be quite high, occasionally into four figures, so you need to be certain the move makes financial sense. There may also be set-up fees to pay.
- Are guaranteed annuity rates affected? Moving your money to another pension fund may negate any guaranteed annuity rates.
- What rates are these current pensions achieving? Will moving and consolidating them help you make more from your money? Do you like having your money spread across different assets?
- Will it change my protected pension age? You need to determine if your ability to take money out at a certain age will be affected by the move.
- Is the pension(s) I plan to move to most suitable for my phase in life? It can be tempting to move to a pension that promises high rates, but often a large rate of return will also come with higher risk. If you’re looking to retire in the near future, it’s a good idea to talk to a pension professional to ensure your money is in the right place.
- Can I change my mind? Make sure there is a grace period where you can back out of the change without penalties. 30 days is standard, but it’s worth knowing, even if you’re certain about your new provider.
- Will I lose longevity bonuses? If your lost pension had bonuses for longevity attached, see if your present provider can match them. Usually, these expire once you stop contributing anyway.
With all this said, it is nearly always a good idea to actively choose your pensions, rather than simply taking what you’re given. Make sure you compare all your options and talk to a professional if you aren’t sure what to do.
If you’ve decided to move your pensions to a new or existing provider, simply reach out to them about the process. In most cases, they’ll take care of moving your pension for you, much like when you choose to switch banks.
It’s incredibly important to track down lost pensions, even if, once found, you decide not to move them. Your primary objective should always be to maximize the amount of money you retire with, without taking on too much risk as you near your retirement date.
In most cases, talking to a pension expert is wise once you’ve tracked down all your pensions. They understand the current laws and opportunities and how government legislation might impact you and your retirement plans. Don’t take a chance on your future; get the best advice you can.
Evason Fildes has been advising people on their financial affairs for many years and has the expertise to help you with your pension plans. We work with the UK’s leading pension providers and can talk you through your options and help you decide what the best next step is. Simply fill in our form, and one of our friendly team members will contact you to arrange a free initial full review of your pension situation. Click here to find out more.