Your pension is an invaluable aspect of a retirement plan. But gone are the days when you would stay at one company for your entire career — and with multiple jobs comes multiple pensions. If you are not diligent about keeping track of them all, you could potentially lose out on your hard-earned money when you need it most.
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According to a recent report published by the Pensions Policy Institute (PPI) the number of lost pension pots has increased by 75% over the last four years. On average, the lost pension pots amount to £9,500 per person and total £26.6bn.
The large leap can be attributed to the increasing number of workers moving home and changing jobs, especially during the pandemic. Auto-enrolment — the process of being automatically enrolled in a pension scheme for workers over age 22 earning at least £10,000 — has also played a part.
Young people are more likely to be affected by this as they might be less inclined to keep track of their pension closely as retirement is a long way away and they feel like there is plenty of time to get their finances sorted. It is also likely they may frequently change jobs throughout their lifetime, resulting in multiple small pension pots. The report highlighted that 10 million new people have enrolled in a pension scheme within the past decade since auto-enrolment came into effect, which is certainly a win, but many are not actively involved in contributing to their pension so they are not aware of the finer details, such as who their pension provider is and the terms of their scheme.
If you have lost track of any pension, there is a way to track them all down, you just need to familiarise yourself with the process. Ensure you have your national insurance number and the names and addresses of all your previous employers and go to the Pension Tracing Service. It’s important to remember that even if a pension pot you have managed to amass is small, if you have multiple small pots, consolidating them all into one could make a big difference.
To discuss all your pension options or for assistance, get in touch with the experts at Dental & Medical Financial Services today.