Only two in five UK adults know where all their private and workplace pensions are held, according to new research, leaving around 60% of Britons at risk of missing out on significant unclaimed retirement wealth.
The findings, released ahead of Pension Awareness Day on Tuesday, September 15, suggest that keeping track of retirement savings is a major challenge for people who have changed jobs throughout their working lives.
Research findings on pension awareness
Research from Mylo at Aegon found that 36% of UK adults do not know where all of their pensions are held. Of these, 20% know where only some of their pension pots are, while 16% do not know where any of their pensions are held. A further 24% said they do not have a pension.
Nick Roy, commercial director of workplace at Aegon, said: "You can't plan effectively for retirement if you've lost track of your pension savings. Yet only two in five adults know where all their pensions are held. For many people, the challenge isn't a lack of interest in planning for the future; it's keeping on top of pension pots accumulated across different jobs and different stages of their working life."
He added: "As people move between employers and build up multiple pension pots, it's easy to lose track of what you've already saved. Before people can decide whether they're saving enough for retirement, they first need to understand what retirement savings they have and where they are held."
Statements and investment checks
More than seven in 10 pension savers – 72% – said they open their annual pension statement, while 69% said they read it. However, just 55% said their statement helps them understand whether they are saving enough for retirement.
There was also a lack of regular checks on how pension money is invested. Almost one in three pension savers, or 30%, said they never check where their pension is invested. Only 21% said they check at least once a month.
Finding lost pensions
People who think they may have lost track of a workplace pension do not necessarily need to pay a company to find it. The Government offers a free Pension Tracing Service that can help people find contact details for a workplace or personal pension scheme. The service does not tell you whether you have a pension with a particular provider or how much money is in it. Instead, it provides contact details so you can contact the relevant pension scheme or provider yourself.
You can also check old paperwork, payslips and pension statements, or contact previous employers to establish which pension scheme you were enrolled in. For those who want a more streamlined way to bring their pension information together, Aegon's Mylo is a service designed to help locate old pension pots and potentially consolidate eligible pensions. However, consolidation is not automatically the best option for everyone, and people should check charges, benefits and investment options before moving a pension.
Once pension pots have been identified, savers can check their balances, fees, investment choices and projected retirement income. They can then consider whether their current contributions are likely to provide the income they want later in life.
People should be particularly careful before transferring an existing pension. Some older schemes can include valuable benefits or guarantees that could be lost if the pension is moved. Anyone unsure about whether to transfer a pension may want to seek regulated financial advice before making a decision.
