Money

‘Check your state pension entitlement’ Britons urged to act as millions misplace savings

It comes as research by Aegon has found 73 percent of people have multiple pensions – an 11 percent increase since the Aegon survey in 2016. This earlier survey found 62 percent of people had multiple pensions.

Despite the increase in the number of people with multiple pension pots, the number of people within this group who have lost track of one or all of their pension pots has dropped slightly – reducing from 21 percent to 17 percent.

However, based on Office for National Statistics data, this still means that around 6.4 million people aged between 22 and 65 may have misplaced some of their retirement savings.

The recent survey also implied an improvement in pension awareness in the last five years, Aegon said.

It found there has been an 18 percent fall in the number of people not knowing the value of their pensions, from 39 percent in 2016 to 21 percent.

The 2021 survey also looked at what caused people to lose track of their pensions.

READ MORE: Pension warning on ‘detrimental effect’ on over 50s – will your retirement plans change?

The research found the main reasons people lose track of their pensions are that the pension company has been taken over or rebranded, paperwork was lost, or people had moved and hadn’t informed their pension provider(s) or employer.

Of those who had moved home, 13 percent said they had never notified their pension providers of their change of address.

When given a choice of options, almost half of people (48 percent) knew to use the DWP’s Pension Tracing Service or to contact their previous employer(s) (42 percent) to find a lost pension.

However, 18 percent of people said they had no idea how to find a lost pension.

Kate Smith, head of pensions at Aegon commented: “As nearly every job comes with a pension now, it’s no surprise that the number of people with multiple pension pots has increased over the years.

“It’s really positive to see a fall in the number of people who have lost track of their pensions, which could indicate that people are becoming more conscious of their workplace pensions.

“This doesn’t mean that we can put the challenge of lost pension pots behind us just yet.

“In fact, as the number of pension pots per person grows through a lifetime of work and while we await the delivery of pension dashboards, there’s a growing risk that losing track of pensions could become more common.

“The smaller pensions pots from earlier in people’s careers are especially difficult to keep track of.

“People are unlikely to have invested much financially but also emotionally in smaller pension pots, especially if they are some way off from retirement, which makes them easy to forget about.

“But the value of many small pots should not be underestimated, they can still play a fundamental part in planning for retirement and improving financial wellbeing now and in the future.

“It’s not the end of the world if you’ve mislaid some of your pensions, you can easily reconnect by using the DWP’s tracing service or contacting your previous employers or pension providers.

“You might be pleasantly surprised about what you find.”

From checking state pension forecasts to tracking down old pension schemes, Ms Smith suggested various steps people could take to help them to spring clean their pension savings.

“Track down old pension schemes using the government’s finder service or request contact details from the Pension Tracing Service on 0800 731 0193 or by post,” she began.

“And once you’ve tracked down your pensions, get advice before consolidating them to make sure you don’t lose out on any valuable benefits.

“Look up your annual benefit statements, you may have saved with more than one employer’s pension scheme.

“Review your spending habits and consider if you have the scope to save a little more each month.

“Get online – have you done all you need to do to be able to manage your pension online to make it simpler?

“Think about what financial milestones you’d need to hit in order to increase your pension contributions and review your investment choices.

“Find out more about your current pension plan. If you pay in more does your employer match your contributions?

“Check your expression of wish form is up to date. This is a request setting out who you would like to receive any death benefits payable on your death.

“Check your state pension entitlement,” Ms Smith continued.

“To receive the full state pension when you reach state pension age you must have paid or been credited with 35 qualifying years of National Insurance contributions.

“Visit the Government Pension Service for information about your state pension.”


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