You may have built up multiple pensions if you’ve had several jobs in your life. What you do with these is your choice, but your options include:
- Keeping them separate
- Combining some of them
- Combining all of them.
We’ve created this guide to help you understand your options in more detail.
Is it normal to have multiple pensions?
It's very common to have more than one pension. With UK workers changing jobs on average every five years, many people build up several workplace pensions throughout their career. Auto-enrolment has made this even more common, as most employees are automatically enrolled into their employer's workplace pension scheme.
Automatic enrolment criteria
- Earn over £10,000 every year from one job
- Aged between 22 and State Pension age
- Work in the UK.
Why do I have more than one pension?
You could have more than one pension if you’ve moved jobs throughout your life, as your workplace pension is linked to your employer. You might also have other personal pensions that you’ve set up. The most common reasons for having multiple pensions are:
- Changing employers – whenever you move companies, your new workplace pension provider sets up a new pension for you if you meet the criteria for automatic enrolment.
- Pots left behind – your other workplace pensions stay with your previous provider unless you transfer them to another provider.
- Personal pensions – if you’re self-employed or not working, you or someone else may have opened a personal pension to keep contributions building up.
Struggling with multiple pensions?
It’s normal to feel overwhelmed by multiple pensions, but we’re here to help. You might relate to some of these scenarios:
1. I don’t know how much my pensions are worth in total
When your pension savings aren’t in the same place it can be hard to see how much you’ve saved for retirement.
2. I’ve lost track of my pensions
You might have other pensions from previous employers that you’ve lost track of when moving jobs, which makes it hard to know what pension savings you have.
3. It’s a hassle to manage my pensions
Managing several pensions can be tricky and time consuming, especially when it comes to updating your details or checking how your pension is performing.
4. I’m paying too much in fees
You may be paying higher charges on some of your older pensions than you are on your current workplace pension.
5. I don’t know what my pension is invested in
Some older pensions may be invested in funds that you didn’t choose or no longer suit your goals or preferences.
Some of these challenges can be addressed by transferring some or all of your pensions into one.
Remember
There are pros as well as cons, deciding what to do with your other pension pots will depend on the type of pension you have as well as what you want to achieve.
A financial adviser can help you understand your options and make an informed decision.
Is having multiple pensions a problem?
No, having multiple pensions is normal. There any many reasons people wish to keep their pensions separate, some pros and cons include:
| Pros of leaving your pensions separate | Cons of leaving your pensions separate |
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How can I track down my pensions?
If you've lost track of a pension, you can often find it using information from previous employers, old paperwork or the Government’s pension tracing service. Once you've found your pension, it's a good idea to update your contact details with the provider. For more information on tracking down a lost pension read our guide.
What are my options if I have multiple pensions?
There isn’t one right answer for everyone. Your options depend on your circumstances and goals.
Option 1: Keep your pensions where they are
This option may suit you if:
- you’re happy with the fees and charges you’re paying.
- you’re satisfied with the support and service you receive.
- you’ve got valuable guarantees and benefits you’d lose by transferring.
- you find it easy to track your pension pots and keep on top of them.
Example
Tom has two pensions. A workplace pension with his current employer and a defined benefit (DB) pension with protected guarantees and benefits with a previous employer.
Tom decides to keep the pensions separate, as transferring the defined benefit pension would mean giving up a guaranteed income for life. He knows that this guaranteed income, together with his State Pension, will pay for all his regular expenses in retirement and he can take money as and when he needs it from his defined contribution workplace pension.
Option 2: Combine some of your pensions
You can transfer some, but not all of your pensions. This might suit you if:
- you want fewer pensions to manage.
- you’ve got a mix of pension types - some straightforward and some more complex.
- you want to keep your workplace pension where it is but move other pensions elsewhere.
Example
Taylor has four pensions. She has a workplace pension with her current employer, two defined contribution (DC) pensions with previous employers and another pension with guaranteed benefits.
Taylor decides to transfer her two DC pensions to her current workplace pension to make it easier to manage. She keeps her other pension where it is as it contains valuable guarantees she’d lose by transferring.
Option 3: Combine all of your pensions into one place
This option might suit you if:
- you want one view of all of your pension savings.
- you’re finding it hard to manage lots of different pensions.
- you’re able to reduce the fees or charges you’re paying.
Example
Ali has eight pensions from previous employers.
Ali decides to transfer all his existing pensions to his new workplace pension, meaning he can see all his pension savings in one place.
Our helpful guide should I transfer my pensions can help you weigh up if transferring might be a good idea for you.
Frequently asked questions
How many pension pots is “too many”?
There’s no such thing as too many pensions, you can have as many as you like. It might feel like too many if you’re finding it hard to keep track of them or understand what you’re paying.
Should I combine my pensions?
It depends. Combining can make pensions easier to manage and, in some cases, reduce fees. But you might also lose valuable benefits. Check our guide should I transfer my pensions for more information.
Can I combine only some of my pensions?
Yes, you don’t need to transfer all of your pensions. In most cases, you can also transfer a portion of a pension and leave some where it is. This is known as a partial transfer.
Are there pensions I should be careful about transferring?
Yes, you should be cautious when transferring any pension. Be especially careful with defined benefit pensions, as transferring them means giving up a guaranteed income for life.
How do I avoid pension scams?
Be wary of unexpected contact, pressure to act quickly and promises of guaranteed returns. Check any provider you wish to transfer is authorised by the Financial Conduct Authority (FCA) (opens in a new window).
More on pension transfers
