A finance expert has warned that Brits could be losing out on hundreds of thousands of pounds in their retirement pots by failing to make six quick checks that take less than five minutes in total. Ahead of Pension Awareness Week, which begins on Monday (September 14), finance expert Antonia Medlicott has cautioned that poor fund performance, rising fees and lost pots are severely denting the performance of standard retirement funds.
The Founder and Managing Director of Investing Insiders said carrying out six 30-second reviews could boost a pension pot by over £250,000 by the time a saver stops working.
Six steps to secure your pension
Medlicott recommends savers log into their online pension accounts to identify the specific fund where their money is invested, noting that the fund name differs from the provider name. If it is not clearly listed, she advises contacting the provider directly.
Savers should then search their fund name using an online pension performance checker to see how it compares against similar funds over a five-year window. Investing Insiders' research showed that, based on a £20,000 pot, the worst-performing fund over five years dropped to just £282, whereas the top-performing fund achieved cumulative returns of 180.28%, growing the pot to over £56,000. While past performance does not guarantee future results, long-term underperformance against benchmarks can strip thousands from a final pot.
Risk levels and fees
Funds vary in risk depending on whether they hold higher proportions of shares (higher risk) or bonds and cash (lower risk). Younger savers placed in overly cautious, low-risk funds risk losing real value to inflation, while those nearing retirement need to avoid high-risk funds that leave them exposed to sudden market drops. Medlicott warns about default workplace pension funds that derisk automatically, as lowering risk too early can cause savers to miss out on vital growth years if they plan to draw an income gradually.
Savers should also check the ongoing charges taken automatically from their pot. If fees exceed 0.75%, they are advised to ask their provider whether lower-cost funds are available within the scheme. A charge difference of just half a percent compounds significantly against a pot over several decades.
Lost pensions and retirement readiness
There are an estimated 3.3 million lost pension pots across the UK, worth a combined £31.1 billion. Medlicott recommends using free online pension finder tools to locate missing pots from previous jobs and contacting former providers. While consolidating multiple pots can reduce admin and fees, she advises consulting a financial advisor first to ensure valuable benefits are not lost.
The average UK retiree aiming for a moderate lifestyle requires roughly £32,700 annually. With a full State Pension providing over £11,500, a private or workplace pot must cover the remaining gap of over £20,000 per year. Savers can run their target numbers through an online pension calculator to check if they are on track, and boosting contributions by just 1% of salary can compound into tens of thousands of extra pounds over 20 years or more.
Medlicott highlighted that time and compound growth remain a saver's biggest assets. She said: "Too many assume they are fine, but they could be missing out on huge amounts due to high fees or poorly performing funds. A retirement can easily last three or four decades, and if that feels like a long time away, remember that it's what you do today that matters."
"Someone who makes all of these checks and invests £2,700 a year into their pension could add an extra £257,000 to their pot after 37 years, and that can come from a small percentage change in fees and by being in the best-performing fund with your provider."
