Learn more about combining multiple pension pots and the key considerations around this process.
These days many of us hop from job to job across our working lives. Even if you don't realise it, you've probably paid into lots of different pension schemes along the way.
Keeping track of all those pensions, often with different pension providers, is difficult. You can't always know how much is in each one, how are they performing, or what admin fees you're paying.
Consolidating them into a single pension pot could be the answer. It's important to check whether you'd lose any valuable benefits, if there are any exit fee's or charges, and if there would be any changes to your investment choices.
The value of any pension could go down as well as up, and you may get back less than has been invested.
What happens to my pension when I change jobs?
When you leave a job, both you and your employer will usually stop paying into any defined contribution workplace pension. That pension still exists though and the money is still yours. So, it's up to you whether you leave it in that pension pot or move it.
This means your pension pot remains relatively static with any fluctuations in value down to pension performance, fund charges and any admin fees.
What is auto enrolment?
Auto enrolment is a government scheme to encourage us to save for retirement and it made enrolling eligible staff into a workplace pension compulsory.
Since 2012 it is a requirement for employers to have auto enrolled their employees into a workplace pension scheme, if they are not already in one. If you've changed jobs since then, this means you could now find yourself with several pensions.
Pros and cons of combining your pensions
| Pros | Cons |
|---|---|
| It’s easier to manage – bringing your pensions together into a single pension pot means everything is in one place with just one set of fees to manage. | There could be exit charges - we won’t charge you if you transfer your pension to us, but your existing pension provider might have an exit charge. There may be other charges to consider, too, such as platform or investment fees. |
| It’s simpler to track performance – online or via our MyAviva app, you can see how much you’re saving, how much your pension is worth over time, and how your retirement plan is shaping up. | You could lose valuable benefits or guarantees – If you have a pension with a guaranteed income or valuable benefits, like taking more than 25% tax-free, you won't want to lose them. You might also be in line for loyalty bonuses, enhanced life insurance, death benefits or early access to your money. Read a list of these benefits types. |
| You might pay lower fees – if you’re paying admin fees on each pension, combining your pensions into a single pot might reduce the amount you have to pay, meaning more remains in your pension pot overall. At Aviva, our charge is no more than 0.35% of the value of your pension. |
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