It used to be that we would amass one pension pot in the course of our career. Many people might stay with the same employer from leaving education until they were presented with the gold watch. This made it very easy to keep track of their employer’s pension and to know exactly how much income they would have in retirement.
But the world has moved on, and on average, we will work for around eleven different employers during our lifetimes.
This means that we could easily have eleven different pension pots waiting for us by the time we retire, plus any private pensions we might take out.
But what is the best way to manage these pension pots – and to maximise the pension income you eventually enjoy?
How many pension pots do you actually have?
The first step is to find out how many pension pots you have – and how much is in each one. This can be harder than you might think. If you have changed employers a few times in the course of your career, the chances are that you have lost touch with at least some of the pension providers who were looking after your cash. House moves are often to blame – annual statements cannot reach us if the pension providers don’t know our new address.
The Association of British Insurers has estimated that there are around 1.6 million pension pots currently unclaimed, together worth a staggering 19.4bn. This works out at an average of nearly £13,000 per pension pot.
Get in touch with your old employers, and track down the pension providers they were using at the time that you worked with them. If an employer has gone out of business, the pension savings you made with them should still be safe – you should be able to track them down with Government’s free pension tracing service.
What to do next
Once you have tracked down your pension pots, ask for a statement from each provider. This should show you how each pot is performing, and the charges that are being deducted for managing your money.
If you have multiple pension pots and discover that some are performing better than others, pension consolidation – putting all your pots together might be an option worth considering.
Your pension is too important to leave to chance, and you need to get some expert help to be sure you are making the right decision.
At Continuum we can help you see if your pension pots should be consolidated and review all your pension arrangements to help work towards your retirement targets.
We can help you look at your existing arrangements with the aim of confirming if they are working at their best for your future, and if needed, help find ways to make your existing pension savings potentially work harder.
The information contained in this article is based on the opinion of Continuum and does not constitute financial advice or a recommendation to suitable Protection products or investment strategy, you should seek independent financial advice before embarking on any course of action.
The value of investments can fall as well as rise and you may get back less than you invested.