Amalgamating pensions all into one pot

[toottootmummy]

I’ve recently tracked down all my pension pots and am currently updating all the accounts with my correct name (now married) and current address.
I have some significant chunks in a couple of the accounts (which took me by surprise) but I feel that the balances might possibly be better all in one place to make it easier to manage. There are currently 6 different schemes across 4 different major providers. Im looking for some advice on how to assess what is best to do.
anyone have any experience of moving all different pensions into one place. I’d be looking to move these into my current workplace pension.

It depends on your workplace pension I think (my wouldn’t allow transfers in).

Are the pensions all defined contribution pensions or define benefits (final/average salary)?

i had a few DC pensions, opened a new Vanguard pension and transferred them in (it was really easy, just needed pension details and could do it all on the Vanguard website).

You need to consider the fees/annual management charge any pension involves (I chose Vanguard as right for me as the fees are fairly low) when you decide which pension to transfer everything into.

its generally not recommended to transfer DB pensions.

My husband did but used an IFA.

I have two pensions. I did have three but moved a very small one into my biggest one. They are both with the same company and I was going to combine them but was advised not to as the “dormant” one performs better.

Agree with others, check and lay out:

• all DC or any DB (I would only consider consolidating DC, retaining any DB for a guaranteed lifelong income)
• do any have GARs or other special terms attached? (Often not wise to consolidate depending on terms)
• what are the fees and charges for each?
• what has the past performance been for each? What risk rating are the investments? What is your risk appetite? How does it compare?

It's certainly simple to have fewer pensions when it comes to drawing but not essential.

Well done on making a start and finding out where all your savings are. Pulling them all together in one pot is a good idea and makes it easier to manage them and keep track but it's not absolutely essential.
As other pp have said if any are DB schemes they are best left alone, even if you can move them it is difficult and expensive.
Personally I wouldn't move them into your current scheme chosen by your employer unless you know that it is a really good scheme. eg if it is Nest then definitely not as they are not a good scheme with very little choice of investment.

I recently pulled 4 small schemes to gather into an interactive investor SIPP and am now actively managing it myself. If you are confident in managing it yourself you can pick a good diversified global fund that matches your risk profile and then leave it alone until you need it. I chose ii because they have a fixed fee structure and are good value at all levels of investment with a wide choice of funds and ETF's.

Before you move anything, ask them to confirm whether they have any additional rights attached. Some older pensions can come with additional rights eg enhanced annuity rates, which you may or may not want but you should know what they are before you decide.

Don't move anything DB (in fact, unless it's tiny they can't let you do this without financial advice.)

I attempted to move one of my smaller pensions into one of my bigger pots & was refused becauseI hadn't consulted with an IFA first. It was a few years ago and I can't remember which Pension company as it was - the one I wanted to transfer out of the one I wanted to transfer into. The cost of consulting an IFA for this wasn't worth my while.

I did the same but wasn’t confident about doing it myself so used an IFA, recommended to me by an acquaintance. I have a separate current work pension but the pensions from my four previous jobs are now amalgamated and doing well. I pay into both pensions each month.

If you keep different schemes you get the flexibility to take a different retirement date with each one.

I kept my workplace one separate but had about 4 other smaller amounts.
I'd be very careful if you visit an IFA as to what they're investing your money in.
I went to one who claimed that it would be better to put all my smaller ones into one bigger pot. I had no idea what they were invested in (suppose it was my own fault for not checking) but I never thought as he was well known in the town.

Turned out they were invested in shit schemes like car parks in Cape Verde and other such rubbish and were "illiquid" which meant I couldn't get the money out. Basically I had to wait until all the companies went into liquidation and then the FSCS compensated me.

Needless to say the guy has now been struck off.

Get advice from an IFA. You can find one at unbiased.co.uk

Thank you for all the great advice. Really helpful. They are all DC schemes

I was going to do this but this year one of my pensions lost £600 and another gained it so I think it’s actually riskier having all in one.

Mine were all moved together (except last employment) as it's easier to keep track and get proper diversification (so balance risk in one place rather than finding two pensions are invested in the same thing).
I would take advice from IFA and if you have isas consider building it into one big risk profile.
There were fees to do the consolidation but over time the improved risk profile and lower %fees has made it worth while.
Last employment stayed where it was as very low cost environment

I got an IFA to go through all of mine and advise.

I ended up consolidating into a single
Platform. It's up 5% since May so doing OK. But it's a long term game
And can go down as well as up.

I found the whole process utterly terrifying though. Despite getting really good expert advice it still gives me the jitters !

The various platform providers make it very easy to move to though so you just need expert help to work out which ones to move and what level of risk you want to take.

Find a good IFA

The retirement date on DC pensions is nowadays purely for life styling options, i.e. moving from shares to bonds/cash as you come closer to retirement.

Unless you have some old style scheme that has no flexibility, your scheme retirement date is largely irrelevant. The only thing that has an impact is when you want to retire and how much you need/want to take out. If you need varying levels of income, it can be managed through one scheme.

My dh had 5 pensions with 4 different providers. Some were really not performing great at all. He had 2 strokes and no longer working and struggled to deal with the pensions. We saw an IFA who looked into them and advised about putting them into 1 pot. After signing the forms he did all the work. There was a charge for this but over the last 6 months they have gained far more than we were charged.

Look carefully at when you can access your money before moving anything into your employer's scheme. Many workplace schemes are now linked to state retirement age (which of course might increase before you get there). Your current DC schemes may allow you to access them earlier than that. A lot of private pensions let you access them 10 years before state retirement age, which becomes useful if you want to retire/semi-retire early.

This is about the underlying investments, not whether you have more than one pot. You can split it between different funds within one pot if you want.

Again, a DC pension pot’s retirement age is mostly related to life styling and does not mean you can’t retire earlier unless you have a really old scheme (which could have an earlier minimum retirement age than the current age of 55).

I transferred my two private pensions into a self selectees vanguard pension 2 years ago, much better growth.

@MontyDonsBlueScarf that’s why I didn’t combine mine.

I found the free government appointment with Pension Wise very helpful.

There can be some advantages to having small pots - additional flexibility to take the whole amount in one go rather than lump sums, draw downs or annuity.
If any are DB then you are likely to have to take financial advice before transferring.
The "pensions dashboard" scheme is coming online in 2026 (I think) which should mean you can log into one place and see all your pensions without having to actually consolidate them.
If you do want to consolidate them for ease or to keep fees low then do check your workplace scheme fund options and fees against others in the market.

@Mumski45 "Pulling them all together in one pot is a good idea"

I would challenge this comment. There are lots of reasons why having more than one is a good idea, including:

• If you transfer a pension you may lose any beneficial special terms that attach (such as Guaranteed Annuity Rates, or the right to draw it from 50 even though the general age has risen to 55/57)
• Putting all your eggs in one basket is always a risk in itself
• Pension pots under £10k can be drawn all in one go as a "Small Lump Sum" (with 75% taxed). You might want to do that with one or two of them at retirement, but can't if they've been mixed into a bigger pot.
• My Dad has three pensions in payment that all pay out on a different day in the month. He quite likes having three little payments each month, it's better for budgeting etc than one big one.

There can be advantages too, such as getting a better annuity rate with a big pot than two small ones, but it isn't a no brainer by any means.

@snowlaser

• Pension pots under £10k can be drawn all in one go as a "Small Lump Sum" (with 75% taxed). You might want to do that with one or two of them at retirement, but can't if they've been mixed into a bigger pot.

There is nothing stopping you from taking a £10k lump sum from an uncrystallised pot of any size (UFPLS - 75% taxable).

The only advantage of the small pot rule is that is does not trigger the MPAA. It makes no difference to anybody who does not wish to make further pension contributions in excess of £10k pa.