How to keep track of your pensions

A recent study has revealed the worrying statistic that over a fifth of all people with multiple pensions have lost track of at least one, with some admitting to have forgotten the details of all of them. With around two thirds of UK residents having more than one pension, this amounts to approximately 6.6 million people with no idea how much they’ve put away for their retirement. Double the amount of people admit to not knowing how much their pensions are worth.

It’s an undesirable side effect of the modern working world. Whereas in previous generations someone might stay at a single employer for their entire working life, the typical worker today will hold eleven different jobs throughout their career, which could potentially mean opting into the same number of pensions through as many different providers. The new legal requirement for all employers to offer a pension scheme through auto-enrolment is likely to add further complexities.

As a result, the Pensions Dashboard is set to launch in 2019 in the hope that it will make it easier for savers to keep track of their pensions in one place. Until then, however, there are four relatively simple steps to help you track down information on any pensions you’ve forgotten about:

1. Find your pension using the DWP Pensions tracing service at www.gov.uk/find-pension-contact-details. Start by entering the name of your former employer to discover the current contact address for them. You’ll then need to write to them providing your name (plus any previous names), your current and previous addresses and your National Insurance number.
2. In the case of a pension scheme which hasn’t been updated for a while, you’ll be required to fill out an online form to receive contact details. You’ll be required to give your name, email address and any relevant information to help track down your pension details. This could include your National Insurance number and the dates you worked for the company.
3. You can also receive a forecast of your State pension either online or in paper format by going to www.gov.uk/check-state-pension. After entering a few details to confirm your identity, you’ll be told the date you can access your State pension and how much you’ll receive.
4. Finally, and most importantly, once you’ve managed to track down all of your pension information, get some advice. Consolidating your pensions might be tempting to make managing your savings easier, but you also want to make sure you don’t lose out on any benefits by doing so. Before you make any decisions regarding your pensions, seek professional independent advice on what to do next.

The development of an online pensions dashboard has been given endorsement from the government and looks as though it will get official approval in 2019. So what is a pensions dashboard? Keeping track of your pensions can be a real challenge, in fact there is currently over £5 billion worth of unclaimed pensions, sitting untouched. The idea of the pensions dashboard is to provide people with a one-stop-shop to access information about multiple schemes and see how much they have available to them. Ultimately, the more informed we are about our pension situations, the better the decisions we can make regarding our retirement.

This isn’t the first time somebody’s had this idea. In fact, the plan to introduce some form of pensions dashboard has been around for a while, but there have just been logistical issues in making it happen.The Financial Conduct Authority first approached the government in 2016 and issued the challenge to make a pensions dashboard available to consumers by 2019. With so much data to collect and so many different organisations involved, it’s not been an easy thing to implement but the end is in sight.

Pensions expert Ros Altmann welcomed the news that the Prime Minister has given official endorsement of the the development of pensions dashboard, stating that it will “help people keep track of all their pensions in one place,” and calling it an “invaluable tool in planning for later life.”

She also acknowledged, however, that there were still some hurdles to overcome. As older legacy pensions are not currently recorded electronically, the task of uploading all of that data will take a considerable amount of time and money. The auto-enrolment pension records, which only began in 2012, could be transferred to a central database relatively easily. This would provide a dashboard for younger workers, with legacy records being gradually updated at a later date.

An incomplete dashboard, however, may come with its own challenges entirely. Tom Selby, senior analyst at AJ Bell, voices his concerns. “The biggest danger is that people make poor decisions based on incomplete information – this situation must be avoided or the long-term damage to individuals and trust in pensions generally could be huge.”

Selby suggested that an incomplete dashboard could be a danger to the dashboard itself. “In the age of instant online banking, people rightly have high expectations of financial companies. A half-baked dashboard risks being discredited from the start.”

There will be a non-commercial dashboard hosted by the Single Finance Guidance Body, although financial services companies will also be permitted to host their own dashboards.

In the meantime, if you think you might have pension pots that have fallen by the wayside, there’s an easy tool to track them down at no cost. All you need to do is get in touch with the government’s Pension Tracing Service – you can find their details at https://www.gov.uk/find-pension-contact-details. If you have any other questions on this topic, do get in touch with us directly.

Keeping track of your pension pots can feel like a full time job at times, particularly as we head towards a world where the average person will have eleven different jobs over the course of their career. It’s becoming increasingly uncommon for people to stay in the same job throughout their employment. In fact, we’re now seeing that 64% of people have multiple pension pots; that’s up 2% since October 2016. While that in itself is not a worry, what is more troublesome is that of that 64%, 22% have reportedly lost track of at least one of those pots.

Which means there are more than 7 million people who may not have access to the retirement funds they’ve worked hard to amass. To make sure you’re not one of them, it’s really important to keep on top of the bigger picture of what you’re owed.

Despite an increase in pension awareness, thanks to auto-enrolment, recent research has shown that 30% of people still do not know the value of their pension. Of course, if you’re not sure of the full value of your savings, it makes it hard to plan properly for retirement.

For some, the best way to get a clearer view of the situation is through pension consolidation. If you have a number of small, automatic enrolment pots, it could be worth bringing them together to make them more manageable. Consolidation isn’t necessarily the right choice in all circumstances, though. Certain pensions, particularly those of an older style, will come with great benefits that may be relinquished upon consolidation. Whether or not this is the right path for you will depend on your personal situation, so it’s always a good idea to consult an adviser to talk you through the process before making any decisions.

If you think you may have lost sight of a pension pot yourself, there is a pension tracker available through the Department for Work and Pensions that will help you locate it. Do feel free to get in touch with us directly, if you have any questions around this topic.