Brits could be missing out on up to £26,042.50 in forgotten pension pots, according to new research from Moneybox, which urges workers to track down lost funds.
Many workers have had multiple employers throughout their careers, and each employer may have enrolled them in a pension scheme. Each employer typically has its own selected plan, which can make it challenging for people to keep track of the funds contributed across different employers. As a result, it's estimated that billions of pounds in pension savings are being held in pots that workers have lost track of or forgotten about.
Research reveals potential lost savings
New research from wealth management platform Moneybox reveals that people across the UK could be missing out as much as £26,042.50 across lost funds. The Moneybox research compared the average number of employers working people have had during their careers with the number of pension pots they believe they hold currently.
The company says the gap between the two indicates that many workers approaching retirement may have lost track of workplace pensions that have built up over decades. Moneybox worked out the estimates using the average value of a lost pension pot (£9,470) according to the Pensions Policy Institute research.
Regional hotspots for lost pensions
Moneybox says their own calculations show that people in Wales could potentially be missing the equivalent of four pension pots, worth as much as £37,880, making it the country's largest potential lost-pension hotspot. The South East, South West, Scotland, Northern Ireland, North East, East of England and West Midlands were the next-biggest hotspots, with the average gap in these regions amounting to around three pension pots.
They estimate that this works out to approximately £28,410 in potential retirement savings. Meanwhile, people in London, the North West, East Midlands, and Yorkshire and the Humber could potentially have lost track of around two pension pots, worth approximately £18,940, the analysis found.
Campaign urges action
The research is part of Moneybox's Get Britain Growing campaign, which calls on Brits to think about retirement planning like maintaining a garden. The firm says tracking down forgotten pension pots is one of the simplest ways to clear barriers that may be hampering the growth of their future retirement savings.
Brian Byrnes, Moneybox's Director of Personal Finance, says forgotten pension pots "are a bit like weeds in a garden". "Left untouched they can hamper the growth of your plants, it's important to keep tidying them up and keep track of what you've planted and where it is," he added. "Keeping old pension pots separated could stop your retirement savings from reaching their full potential. The good news is that tracking down old pensions is one of the simplest actions people can take to improve their long-term financial future."
"Even if each pot seems relatively small, together they can add up to tens of thousands of pounds that could make a real difference in retirement. Retirement planning doesn't have to feel overwhelming. Like gardening, it's about taking small, consistent actions over time. Finding an old pension, reviewing your savings or bringing everything together in one place are all simple steps that can help grow a retirement full of possibilities."
The Government's pension tracing service allows find contact details for pension administrators, and there are also third party pension search tools like Gretel that can help find lost pots.
