One view for your Pensions

Being pro-active with your Pensions now could have a significant impact on your happiness and quality of life in future. Making the right decisions now could mean a higher income and a more comfortable retirement, or even an early retirement.

Throughout the course of our lives, naturally you can expert to accumulate several different Pensions from a range of sources, including:

• Workplace Pensions from each job we have
• Recommendations from previous financial advisers
• Personal Pensions we’ve set up and since forgotten about

Your Pensions won’t automatically follow you if you switch employers, which is why savers can end up with multiple pots from numerous providers.

Having multiple Pension pots is becoming more common for savers, and it is currently being considered by regulators and the finance industry.

Having your Pensions scattered around with different providers can make it difficult to stay on top of the administration, fees and performance of each plan. How will you know if you’re on track to meet your retirement goal if you can’t easily view all of your plans?

You can choose to leave your old Pensions where they are, or you have the choice to consolidate them. Consolidating your Pensions means that you can see your lifetime’s worth of retirement savings in one place.

Please be aware however that certain Pension policies can provide valuable guarantees, such as guaranteed annuity rates, protected higher tax-free cash percentages and protected retirement ages. Some plans, often workplace schemes, also benefit from low charges that cannot be matched elsewhere. These guarantees and benefits could be lost if transferred and therefore Pension consolidation is not right for everyone.

Why consolidate?

Combining Pension pots can:

• Make it easier for you to track your progress towards retirement

Consolidating your Pensions allows you review your investments, make changes, top them up and track them all in one place. This gives you more control over your retirement savings, as you will be able to see exactly how much money you have saved, and how much more you need to save to reach your retirement goal. You have full view of investment performance across all your pensions. You won’t have to worry about losing track of your savings.

• Ensure that all your retirement investments are matched to your personal attitude to risk

Choosing the portfolio risk level you’re most comfortable with, in regards to your pensions is important. Unless an adviser has reviewed all of your pots, they may not be in line with your attitude to risk, meaning you’re exposed to greater or less risk than you’d like.

• Ensure your investments are diversified

If you have multiple pensions invested with different providers, you could run the risk of not being well-diversified. For example, some of your Pensions might be invested in similar assets, industries, or regions. If an adviser hasn’t reviewed your Pensions they may be weighted heavily in one place, style, or asset, which could be bad for long-term growth. Having your Pensions in one place would allow them to be diversified in line with your preferences and goals.

• Offer the potential for greater growth over the long-term.

Another benefit to having one view for your Pensions is the opportunity for greater potential growth. Making ‘little and often’ contributions to your retirement fund allows you to harness the power of pound cost averaging which in turn could have a significant impact on your retirement income.

• Potentially reduce the overall fees you pay.

Moving all your pensions to one provider allows you to see exactly what you are paying for but also could potentially reduce the total amount of fees you pay.

What next?

If you have a Pension or several Pensions that might benefit from consolidation, we’ve made the process of combining them with your current Pension simple:

1. Log in to your account online or through the True Potential app

2. Select your current Pension from the overview

3. Click ‘Transfer in existing Pension’

4. Complete a few details and submit your transfer

It is important to understand your options and how Pension consolidation could impact you, before making a decision. This communication is for general information only and should not be considered a personal recommendation.

If you have any questions or would like us to review your Pensions before a potential transfer, please call us on 0191 500 9164 or send a secure message through your account. Our Customer Care team are available 7am-8pm Monday to Friday.

 

Your capital at risk. Investments can fluctuate in value and investors may not get the amount back they invest.

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