It’s often a challenge to keep track of numerous workplace and private pensions – not only does this stop you from knowing how much your pension pot is worth, but it makes retirement planning more difficult.
Here are some tips from an experienced financial adviser to make life easier:
1. Merge your pensions into one performing pension pot
As well as ensuring you get the best potential return on your investment, merging your pensions can also help you to avoid paying multiple charges and hidden fees from your pension provider, that could be costing you money. For the purposes of retirement planning, however, a key benefit of pension consolidation is easier pension management.
If you have online access, you can instantly know how much money you have in your pension fund and make a far more accurate prediction of how much you will receive when you retire. It’s also easier to keep track of your contributions, whether that’s personal or from your employer, making sure they are getting deposited into your pension.
2. Keep your pension provider updated
According to the Association of British Insurers (ABI), up to £20 billion worth of defined contribution pension remains unclaimed. However, it’s not just a matter of individuals losing track – if you have a forgotten about a small pension but have moved to a new house or changed details, the provider has no way to contact you.
It’s essential to keep your pension company updated with any name changes, when you move home, telephone number, or email address. If you plan to move your private pension to another pension provider, if your details are updated, it makes the whole process of pension transfer much easier and quicker.
3. Move into a modern fund
If you’re like us, it’s difficult to imagine the days before online banking. Just like your bank account, it’s often possible to manage your pension online or through app access. When making the decision to merge your pensions into a single fund, this should be something to consider. Being able to access your pension instantly makes for much easier pension management. It’s far more straightforward to adjust your funds, check your balance, and make sure your contributions are going where they should be.
4. Consider a multi-asset pension fund
A SIPP – self-invested personal pension – could be a great option for those who are more confident and experienced investors. Although it needs a fair level of commitment, it provides lots of potentials to choose exactly what funds you invest your money into. Most people will invest in a range of funds – but this can mean lots of paperwork. If you are getting reports from multiple pension fund managers, it can be difficult to keep track.
There are, however, some multi-asset pension schemes, under a single pension provider that could be a good option if you are not an experienced investor but still want some investment flexibility. Whilst you still have the freedom to choose, having a single point of contact can make it much easier to manage. If you’re not an experienced investor and you’re in a SIPP, it maybe wise to look at moving your pension to something a little more secure.
5. Use the government’s Pension Tracing Service
Since 2016, tracking down that lost workplace pension has been a bit easier. The government offers a Pension Tracing Service – https://www.gov.uk/find-pension-contact-details – to help you out. By putting in the name of any former company you worked at – even if it no longer exists – you can find out the contact details of their pension provider to assist with your inquiries.
To get free, impartial advice on Pension Consolidation, contact Pension Works today on 0808 164 2664. Or, visit www.pensionworks.co.uk