Saving for retirement can be notoriously difficult, so it’s important savers have access to the right tools to achieve their financial goals. Yet savers leave around £400 million in lost pensions each year. That’s why Moneyfarm has partnered with MyFutureNow to help you find any old pensions.
The average Brit has 11 jobs in their career. In an era of autoenrollment that’s 11 different pension pots to keep on top of, so it doesn’t become difficult to lose track of what you’ve got and where it’s held.
Chances are, you’ve pictured your retirement lifestyle. You know what you want, but do you understand what you’ll need when you retire and how to get there?
Knowing exactly what you’ve got today is the first step to reaching your financial goals. You don’t want have less income in retirement or have to work for longer than you wanted because you lost track of your hard-earned pension savings.
Moneyfarm and MyFutureNow find lost pensions
A lost pension pot is lost savings, lost tax benefits, and lost money for retirement. That’s why we’re working with MyFutureNow to help you track down any pensions you’re struggling to find.
Don’t worry if you’ve misplaced any important information about your pension – all you need to get started is know your employer and when you worked there. If you know who your pension provider is then even better.
MyFutureNow will use this information to find any lost pensions for you and transfer them to your Moneyfarm Pension for free.
This search would usually cost between £35 to £90, plus 0.15% of the amount transferred, depending on the number of transfers completed. We’re committed to helping you build a financially secure future, so will take on this cost for you.
To use MyFutureNow to find any lost pensions, visit the website and get started today.
Benefits of consolidating your pension pots
There are a number of reasons you might think about transferring your pension to a new provider, or consolidating your old pensions into one place.
- You want a different pension service to the one your provider is offering
- You want to consolidate your old pensions to simplify your plan
- You want to pay less in fees
- You want a higher income
- You’re moving abroad and want a local scheme
- Some older schemes may not offer certain freedoms, like UFPLS
Transferring all your old pensions into one pot can help make your pension savings more efficient. Instead of analysing 11 different accounts to see how much you’ve got and understand the costs and fees you’re paying out, you just have to log in to one account.
It might also be cheaper. Many wealth managers have a tiered pricing structure that decreases the more you invest with them. At Moneyfarm you pay 0.7% on anything up to £20,000, 0.6% on anything between £20,000 and £100,000, 0.5% on anything between £100,000 and £500,000, and 0.4% on anything above £500,000.
Spreading out your pension into smaller pieces means you’re probably in the most expensive price band, whereas consolidating all your pensions into one could take you into a cheaper band above.
Having everything in one place means you can easily see what you’ve got and whether you’re on track for the right retirement. And if you’re not on track to get the retirement income you were hoping for, you can also easily identify and make the necessary adjustments you need to get there.
If you have your pensions in different places, this can be more difficult.
You can use Moneyfarm’s Pension Calculator to help you work out how much you need to be saving a month to get the income you want in retirement, or start one of Moneyfarm’s regular investment plans.
Transferring defined benefit and defined contribution pensions
The pensions industry is more flexible than ever before, but it’s important you check whether you’ll pay a transfer fee to move your money to a new pension pot or whether you’ll lose any guaranteed benefits.
Once you ask MyFutureNow to find your lost pensions, they will screen each pension. MyFutureNow will initiate the transfer if the pension is eligible, if not, MyFutureNow will let you know. In the absence of advice, you should not transfer a defined benefit scheme.
You can read about all the fees your pension provider could charge you in this Moneyfarm and Boring Money research on costs in the pension industry.
There are also some rules about transferring defined benefit and defined contribution pensions to be aware of.
Defined benefit pension
- The FCA believes defined benefit pensions offer more security than a personal pension, as they offer you a guaranteed income throughout retirement and benefits to a spouse or partner if you die.
- These schemes are often index-linked to offer a form of inflation protection throughout retirement.
- Not everyone with a final salary pension can transfer it.
- You’ll need to get a ‘cash equivalent transfer value’ (CETV) from your pension provider before you transfer to value how much your pension is worth and whether you should transfer to a personal pension.
- There are pension transfer calculators available that calculate whether your CETV represents good value.
- If your pension is worth over £30,000, you’ll need to have a consultation with an Independent Financial Adviser before you transfer, otherwise many personal pension providers won’t accept you under regulation.
Defined contribution pension
- As defined contribution (DC) schemes rarely offer any guarantees, it’s easier to transfer your DC pensions.
- You can find your pension transfer value from your annual statement or from your pension provider.
- Most company pension plans will allow you to transfer to a personal pension or other workplace scheme without speaking to a financial adviser, although this isn’t recommended if you’re unsure.
- There can be some fees attached to transferring set by other providers, so make sure you’re aware of all charges before you transfer, as this could make a big impact on larger pension funds.
Don’t let your pension savings become a statistic. Let Moneyfarm and MyFutureNow find your lost pensions and provide you with the investment advice to keep you on track with your retirement goals. Get started today.
*Latest figures from HMRC