Private pensions: to keep separate or join together?

[LovingLifesHurdles]

Does anyone know if it's better to keep private pensions separately or if it's better to put them in 1 pot?

I have contributed to workplace pensions and moved a few times. Now I have a few separate pensions with varying amounts floating around. Would they increase faster if they were together? Or is having multiple pots a good way of reducing risk? And if you did put them together, how do you choose the right provider?

Sorry if these questions are really basic, I'm not very financially literate.

If it makes a difference I'm still 25+ years away from retirement

I'd look at the charges for each provider and move if anything seems unreasonable compared to the others.

Also, if you have small pots ( under 10k) and you think you'll reach your LTA( a little over 1mil), it's worth leaving them there as you can have a max of 3 "small" pots that you can take out without impacting LTA.

Check that the level of risk is appropriate by looking at the factsheet of your funds - it should say what's the % of equities ( stocks) Vs bonds. With 25+ years, I'd go for a higher level of risk.

I would recommend speaking to a financial adviser - most will offer a free consultation where they can discuss your current pension pots and if it would be worth consolidating them :)

The companies that advertise a service to put your pensions together are only doing it because of the commission they take out, which probably negates any saving you make.

You can get discounts on charges and having them together will make your pension savings picture easier to understand,

It's worth getting a free hour with a IFA who can give you and overview

I consolidated all mine into a single SIPP
I have entire control over it and how it’s invested.
Can view, swap around and update it every day or as often as I wish
One of the (major uk) companies I had a pension with went bust - but I had already taken my funds out.
(Have to check first though what the specific protected benefits are with each one before electing to leave)

Thanks for your message, the LTA is new to me. Absolutely shocked that you can be taxed over 50% if you save over a certain amount!

Perhaps separate pots is not such a bad thing!

Thanks also for those suggesting I speak to an advisor. It seems it's not entirely clear cut so I will do that.

Combining them in and of itself won't make you earn greater investment returns; it's what they're invested in (less the charges that apply) that determines that.

Combining them might get you a better price on an annuity if that's what you want to do at retirement, but you could combine them much later: you don't need to combine them today.

Leaving them separate may allow them to be taken as small pots today, but who knows what the rules will be in 25 years time.

Speaking to a financial advisor is a good idea, but only if it's an independent financial advisor (IFA), otherwise they'll probably just say "transfer them all to my scheme!"

To combine them you'd have to end up selling your current investments and then buying new, combined ones which would have a small cost in fees to do.

As you say, combining them is also "putting all your eggs in one basket".

One of the main reasons for combining them is that sometimes people forget about one or more of their pots. If you are the diligent sort who keeps good records. If you don't want the hassle of keeping lots of providers up to date with your latest address etc that may also factor into it!