Pension warning: Millions urged to trace lost pensions as average pot is worth £13,000 | Personal Finance | Finance
The average lost pot holds £13,000 – but some people throw away a lot more than that. Around 1.6 million pensions worth £19.4billion have been left unclaimed in the UK, Hargreaves Lansdown reported.
On AJ Bell Money & Market$ podcast, finance expert Tom Selby discussed pension consolidation and how millions of Britons can benefit from doing this.
He answered a question from a listener who did not know the best way to find all her pensions.
Jackie is 45 and she told Mr Selby that she had worked around five jobs since leaving university who had all offered her a pension. She did not know where to start when finding them.
The DWP estimated that Britons may change jobs around 11 times in their professional career, and with auto enrolment it’s more likely they will have different pension pots with different providers.
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“It’s a problem that is going to increase over time,” he said.
By 2035, the pension policy institute states there could be as many as £27million of these “so called differed pension pots” in the UK.
Mr Selby said this is a problem in need of a solution.
He continued: “The pension tracing service is a useful Government tool.
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“You could move somewhere that offers you a better service.
“You can also increase the choice you have for your investments.”
He offered a word of warning for people with old-style pensions.
Britons with pensions from the 1990s – 200s should check if there is valuable benefits attached to those pensions that may be lost.
He said: “You should check if there are any exit charges which could erode the value of your fund.
“Your existing provider should be able to tell you if this is the case.
“Once you’ve checked this and transferred your pensions, the rest should be straight forward and can be done within four weeks.”
