Our guide to pension consolidation

If you have more than one pension, our guide looks at the pros and cons of consolidating them into one pension pot.

The vast majority of us end up with several different pension plans over the course of our working lives. Some of these might be “defined benefit” schemes, in which your pension in retirement is based on the number of years you have worked for your employer and your final salary. However, most of us these days tend to be in “defined contribution” schemes, where the only certain thing is what we and/or our employers have put in.

So is it worth consolidating your pensions? Certainly, consolidation can make it easier to keep track of your pension from an administrative point of view and it could potentially lower the amount of fees you pay.

It can also help you make the most of your savings by choosing investments that are performing well and getting rid of the underperforming ones. And, as well as making your retirement savings easier to manage during your working life, having fewer pensions can also be easier to manage once you retire.

However, if you have any defined benefit (“final salary”) pensions, it is rarely worth moving those into a defined contribution (or “money purchase”) plan, as you would be taking on the investment risk instead of the pension scheme. It may also be that your pension has additional benefits which would be lost if you move the pension money elsewhere. In some cases too, there could be exit fees to deter you.

So the decision on whether to consolidate your pensions is not straightforward, which is why we’ve produced our guide. Please feel free to read or download it by clicking on the link below.

For most people, it makes sense to discuss pension consolidation with a financial adviser, to ensure that all the important factors are taken into account. The aim should be to end up with a pension plan or plans that provide you with the flexibility you require, to help you achieve a comfortable lifestyle in retirement.

So, if you have questions about whether pension consolidation could make sense for you, or whether you’re on track to enjoy the retirement you want, please contact us.

We can work with you to help you understand how to get the most out of your pension contributions and how the decisions you make now could affect your retirement.

Download our pension consolidation guide

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