We tend not to think about pensions until later in life as our retirement approaches. Even though you may have contributed to a workplace pension scheme for years, it is easy to lose track of them.
Indeed, losing track of pensions is common, and it amounts to almost £20 billion in pension funds remaining unclaimed. However, this money belongs to someone, and a proportion of it could be yours. Therefore, this article investigates how to find old or lost pensions and what to do when you recover them. Getting professional and regulated financial advice will help you with planning for your retirement, check out Portafina.
Why is so much pension money unclaimed?
Lost or forgotten pensions have led to approximately 1.6 million pension pots being unclaimed. These pensions amount to £19.4 billion, according to figures provided by the Association of British Insurers (ABI).1 On average, this is almost £13,000 for each lost pension pot. Here are a few reasons why so many pension pots remain unclaimed.
One of the most common reasons people forget about all pensions is their moving home. Relocating involves considerable administration and stress. Remembering to inform your pension provider about your change of address can easily fall to the bottom of your priority list.
Indeed, according to the ABI, only 4% of people remember to inform their pension provider of their address change.1 If you don’t fall into this small percentage, you could be one of the people who have unclaimed pension funds. Although your pension provider will send you an annual statement, it’s no good to you if it’s going to the wrong address.
Changing jobs is another reason for pensions becoming misplaced, lost, or forgotten. You will stop paying into your old workplace pension scheme when you change jobs. It is easy to lose track of all workplace pensions as your focus is no longer on your previous employer.
Tracing lost pension schemes.
You now know a couple of reasons why you might lose track of an old pension, but how can you trace them? Often, searching by a pension’s old name or provider may not be sufficient. In the meantime, they may have been merged, closed, or renamed, making your search more challenging.
Start by gathering together any old paperwork and information about your pension and your previous employment. If you’ve moved home since your job change, try contacting the provider and giving them your new address. You can also try contacting your previous employer and getting the information you need from them.
Contact the pension provider.
Once you’ve gathered together information about your pension scheme, you can contact the provider. Having given them some basic details, you can expect to find out the following information:
- Your pension’s current value.
- Likely retirement income.
- Amount paid into your pension.
Contact your former employer.
If you have to contact your employer to get information on your pension scheme, they should be able to help you.
Other methods of tracking down your pension.
If you’re struggling to find your pensions yourself, consider speaking to a financial advisor. They can either give you the information you need for your search or locate your pensions on your behalf. Having found them, a financial advisor can assess your pension plans and give you some recommendations. Acting on this advice could give your retirement fund a significant boost.
Another good way of locating your pension is to look where your contributions were going. You can see this by going through old payslips and bank statements. Indeed, this will help you find your pension provider. However, pension providers can change names, and pension schemes can get taken over. For instance, if your employer cannot pay the promised pension benefits, the Pension Protection Fund could take over the plan.
You’ve located your pensions; now what?
Once you’ve relocated your pensions, you should be in a better financial position for retirement. However, what should you do with them now?
If you have several different pension schemes, you might consider merging them into one to make it easier to administer and keep track of them. Also, switching your pension funds into a better-performing scheme can be advantageous in the long run, as your pot will grow more.
A bigger pension pot means a better retirement.
When it comes to your pension pot, size matters. The more you have in your pension pot, the more comfortable you will be in your retirement. Therefore, you must track down any lost, misplaced, or forgotten pensions as soon as possible.
Hopefully, by reading this article, you will understand how to do this yourself. However, if you need any assistance in chasing all pensions, you should contact a regulated financial advisor.