More than £3 billion is currently laying unclaimed in lost pensions. Could any of this be yours?
Research suggests that around 5 million people could be missing out on income when they retire because they have lost track of some of their pension savings. According to the charity Age UK, nearly a quarter of adults have overlooked at least one pension.
The main issue seems to be that most people now do a number of jobs in their lifetime. According to the Department for Work and Pensions, people work for an average of 11 employers over the course of their working lives. Moving from employer to employer can result in a string of small pension pots, which even if they do not go missing, can end up being worth less than if the money was held all in one place.
Lucy Harmer from Age UK’S head of services, says it is vital that people take time to work out what pensions they are owed: "We strongly advise people to seriously think about planning for retirement and the kind of lifestyle they want – it's never too early."
So how do I locate my missing pension?
A lost pension pot doesn’t have to be a disaster. To help you find any lost pension pots, the first step is to search through your old paperwork and see if you have details of any schemes you have forgotten about. If you find paperwork which has a former postal address for you, make sure you write to the scheme provider giving you current contact details.
The government offers an online pensions tracing service, which you can also access by phone (0845 6002 537). The service will ask for your national insurance number and information about the employer you worked for when you had the pension, what your job title was and contact details for the employer and/or the pension provider. Alternatively, you could contact your previous employer to ask for details of its pension provider
When I find my lost pension what should I do next?
There are a couple of options to consider after you have located your past pension pots. You could leave it where it is or move the lost pension and consolidate your funds. If you decide to move the lost pension, you will need to consider any exit penalties on your fund and any benefits you may lose by moving it. When you have tracked down all your schemes, you can contact your providers to get a quote for the transfer value of the pension pots. Ask for a statement, which should include details of any penalties you will face, as well as a final value.
If you do decide to consolidate your pension funds, make sure you store written details somewhere, just in case a family member has to manage your affairs for you.
When it comes to lost pension funds, it is important that you seek financial advice to help you research the different options available and find the best course of action to support your future retirement income.