Why Knowing Where They Are Matters
If you’ve changed jobs during your career, there’s a good chance you’ve built up more than one pension.
In fact, many people are surprised to discover they have pension benefits spread across several providers, often accumulated over decades.
While this is perfectly normal, it can make retirement planning more complicated than it needs to be.
The key isn’t how many pensions you have.
It’s knowing where they are, understanding how they’re performing and ensuring they still support your retirement goals.
How Do People End Up With Multiple Pensions?
Imagine someone who has worked for four different employers throughout their career.
Each time they changed jobs, they joined a new workplace pension scheme.
Their previous pensions remained with their former employers’ schemes while new contributions were made into the latest one.
Over time, they’ve built several pension plans with different providers, investment funds and retirement options.
This is far more common than many people realise.
Is Having Multiple Pensions a Problem?
Not at all.
Many people have multiple pensions.
However, managing them can become more difficult, particularly if you:
- Receive statements from several providers.
- Aren’t sure how much you’ve saved in total.
- Don’t know how your pensions are invested.
- Have lost track of older pensions.
- Haven’t reviewed them for many years.
Without a clear picture, it’s difficult to know whether you’re on track for the retirement you want.
Should You Combine Your Pensions?
For some people, pension consolidation can make retirement planning much simpler.
Potential benefits may include:
- Having one provider instead of several.
- Easier administration with less paperwork.
- A clearer view of your retirement savings.
- A more consistent investment strategy.
- Potentially lower charges, depending on the pensions involved.
However, consolidating pensions isn’t always the right choice.
Older pensions may contain valuable guarantees, protected retirement ages or other benefits that could be lost if they’re transferred.
Every pension should be reviewed individually before any decision is made.
A Simple Example
Imagine you’ve worked for four different employers and have built up the following pensions:
| Pension | Value |
|---|---|
| Pension 1 | €18,000 |
| Pension 2 | €42,000 |
| Pension 3 | €65,000 |
| Current workplace pension | €75,000 |
| Total | €200,000 |
Although your retirement savings total €200,000, they’re spread across four different providers.
For some people, consolidating suitable pensions into one arrangement can make it easier to monitor performance, review investments and understand their overall retirement position.
The important point is that convenience should never be the only reason for transferring a pension.
The benefits of every existing plan should always be carefully assessed first.
Why Regular Pension Reviews Matter
Whether you keep your pensions separate or decide to consolidate some of them, regular reviews remain important.
They can help you:
- Understand the total value of your retirement savings.
- Check that your investments still reflect your attitude to risk.
- Identify opportunities to improve investment performance or reduce charges where appropriate.
- Ensure your beneficiary nominations are up to date.
- Keep your retirement plans on track as your circumstances change.
Your pension is likely to be one of your largest financial assets.
Giving it regular attention can help ensure it continues working towards your long-term goals.
How Oaktree Financial Services Can Help
Every person’s retirement journey is different.
That’s why every pension review should be tailored to the individual.
At Oaktree Financial Services, we help clients make sense of their pensions by providing a complete review of their retirement savings.
We can help you:
- Locate older pensions.
- Explain the benefits and features of each plan.
- Assess whether pension consolidation is appropriate.
- Review your investment strategy.
- Ensure your pensions are aligned with your retirement objectives.
Our advice is based on what’s right for you, not simply on reducing the number of pension plans you have.
Adrian Godwin is a Senior Financial Consultant and the co-founder and managing director of Oaktree Financial Services. With a background in accounting and tax advising, Adrian specialises in estate planning and wealth management.Adrian offers clients reassurance through best practice solutions. His unique skill set and qualifications enable clients to develop comprehensive life plans that align with their goals.
