Drewberry™ provide pensions, investment and insurance advice for Money to the Masses readers throughout the UK.

tracing old company pensions

What Happens to Pensions from my Old Jobs?

The idea of the ‘job for life’ is long gone. It’s now common to have several jobs throughout your career. That means people go through their working lives building pension pots in different workplace schemes with different employers, especially since the introduction of auto-enrolment.

This guide includes information on consolidating pension funds if you have multiple pension pots from multiple employers.

Are You Pension Happy?
Call us on 02084327334
I know how much my pension is worth
I know how much my pension costs
I have clear financial goals for my retirement

 Should I condense my pensions?

One of the biggest reasons for consolidating your pensions is simply because it’s easier to keep track of fewer pots.

Consolidating your pensions often means you engage in a review of all your separate plans at the same time, which will allow you to see which funds might not be performing as well as expected, or which ones have historically high charges that are eating away at the growth potential.

There will be charges on each individual pension plan, so rather than paying several sets of charges it might be beneficial to pay just one or two. Moving your pensions into one place could also ensure better growth in the long-term, depending on fund performance and the length of time you stay invested for.


Consolidating defined benefit pension plans

If you have a defined benefit or final salary scheme, then consolidating your pensions might not make sense. If the value of your defined benefit pension(s) is over £30,000, you’ll need to get pensions advice before doing so.

Depending on your circumstances, it might be worth making a pension transfer advice enquiry. An adviser will help you decide if you could benefit from transferring your final salary scheme to a money purchase scheme. Benefits of doing so include taking advantage of the current high transfer values being offered.

It may not be right for you, however. An adviser could help you decide whether this is the case. Also, you won’t be able to transfer your final salary pension if you’re in an unfunded public sector scheme. An unfunded defined benefit scheme is one where there’s no central pot of money and the pension benefit is paid directly by the government at retirement. Such defined benefit schemes include those for teachers, the police and the NHS.

Start your journey today...
  Find out how a Drewberry financial adviser can help you reach your destination by making the most of your finances.
Call us on 
Consolidating your pension funds

Options for consolidating pensions

One option for combining several defined contribution pension pots is to transfer them all into a single fund. While it may seem easier to manage to have all of your retirement savings in one place, whether or not this is right for you depends on the types of pensions you have and the length of time before retirement. You should also consider what your pensions are worth before shifting them into one fund.

consolidating workplace pensions

Combining your pension arrangements into one big fund also means all your retirement eggs are in one basket – if that fund performs poorly, then you could lose out.

However, if you have several poorly-performing funds with high management charges and you have some time before retirement, amalgamating and transferring these pension assets could make a significant difference to the growth rate of your pension pot in the long run.

Moving pensions from old jobs to new employers

If you’ve changed jobs, you can leave your pension pot invested with your old employer’s scheme if you wish. It will continue to grow, but you most likely won’t be able to continue to invest in it.

You might also be able to transfer your pot to your new employer’s scheme, providing your old scheme allows this and your new scheme will permit the transfer.

transfer pensions from old employers

However, doing so could incur a transfer fee and you could lose any rights you had under your old scheme, such as the right to take your pension at a certain age. There may also be termination penalties on your old pension and other adverse effects.Check whether your old scheme provides benefits that your new one doesn’t, such as guaranteed annuities or a spouse’s pension. These might be valuable and you should check how much they are worth before you decide to move your pension.

Make sure you understand the consequences of swapping schemes from an old employer to your new job, or get a pensions adviser to look it over and discuss whether this is the right thing for you.

Moving from a workplace pension to a private pension

When you leave a job, you can also take your pension pot and move it into a private pension plan, such
as a stakeholder pension or a self-invested personal pension (SIPP). You won’t get any contributions into this from either your old employer or your new employer, however, so it won’t grow as fast.

An advantage of transferring your workplace pension to a private pension is that you’ll have more control over how the fund is invested, especially if you opt for a SIPP.

It’s always best to consider getting advice if you’re thinking about doing transferring your workplace pension to a private pension plan.

Need Help? Start Live Chat with our Experts  

Pensions Advice

Income Protection

Things to think about when combining pensions

Pension consolidation fees and charges

It is very important to be clear about the financial implications of moving your fund. You may face a number of charges for doing so, including:

  • An exit penalty for leaving the fund early
  • Higher charges at your new pension scheme
  • Charges to start a new pension.

Your previous employer may also try to persuade you to leave the fund by giving you an enhanced transfer value – a bonus on the actual value of the fund. However, this might not be a true equivalent to the benefits you are giving up, which could see you lose out.

That’s why you should make sure you understand your options before you make any moves to transfer pensions, and why getting financial advice on pension consolidation could be of incredible value to ensure you don’t fall foul of these fees or get short-changed.

managing my company pensions

Combining pensions: How have my funds performed?

Before you move, look at how the funds in which your pension money is invested have performed. If they are performing poorly or are in closed funds no longer open to new members, then it may be time to leave in search of better growth.

Pension consolidation: Where is my pension pot invested?

Some pension funds automatically switch your investments from equities (shares) into fixed interest rate products such as bonds and gilts over the ten years before your chosen retirement date.

However, if you are planning to leave most of your fund fully invested, then the potential growth will be affected if you’re in more cautious investments. It might be worth reviewing these and discussing your options with an adviser to make sure the funds are invested in the right place to match your expectations of growth.

Moving pensions to funds that allow drawdown

The new pension freedoms offered a wider array of options for those looking to access their pension pots and make retirement provisions. That includes opening up the option of pension drawdown or income access drawdown to more people with defined contribution pensions.

However, not all funds allow drawdown and you might have to move to a new fund that does if you want to consider this as an option for providing retirement income. As with all long-term decisions affecting your pension, it’s best to get financial advice on income drawdown to see if it’s suited to you. You need to be aware that if you take too much of your pension too early and/or live longer than you were expecting, you could run out of cash.

Consolidating your pension? Speak to a financial adviser

Consolidating or transferring your fund is an important financial decision and one which will affect your standard of living into retirement. It could mean that you have a higher income in retirement or are able to retire earlier than you had anticipated.ca

Getting financial advice on consolidating, combining or transferring your pension(s) is very important. Our team of specialist pensions and financial advisers are available to talk through your specific situation with you. Just drop them an email at wealth@drewberry.co.uk or give us a call on 0208 432 7333.

Pension Consolidation Guides

Pension Consolidation Guides

Should I Consolidate My Pensions?

Pension transfer advice unearths buried treasure for leading lawyer

Guide to Final Salary Pension Transfers

Frequently Asked Pensions Advice Questions

I’m almost 55 and have a final salary pension. I’ve read the articles about the new pension...
I’ve been at my current employer for a number of years and have built up a pension entitlement,...
Now that I’m nearing retirement, I’m trying to rationalise my various pensions so I can see...
I’m approaching retirement and have built up a defined contribution pension pot over my working...
Start your journey today...
  Find out how a Drewberry financial adviser can help you reach your destination by making the most of your finances.
Call us on 
4.93 / 5 Average
652 Reviews
Verified Buyer
Overall Rating
The whole process was a pleasure. Drewberry we're easy to deal with, polite, knowledgeable and helpful
Verified Buyer
Overall Rating
Very good, clear service would recommend to friends and family
Overall Rating
Sam Carr provided an efficient and professional service.
Verified Buyer
Overall Rating
Sam Carr provided a professional but enthusiastic service and helped make the whole process very straight forward. Goodness knows I have been through enough application forms recently. My insurance product was never going to be easy to find and I had been rejected on a number of other occasions through others ironically due to well managed common health conditions. I identified Drewberry in a last and disappointing trawl on th web to find someone that actually wanted to take on a difficult case like me. Some brokers wouldn't even consider me. When we applied for my first choice product Sam wasn't at all deterred by the long wait for my GP report or the final rejection that came back from the insurer, sadly I have become used to it. Within a day he had lined up the second choice and to my surprise he had hit the nail on the head and introduced me to the correct insurer and terms for my needs whilst nogotiating an excellent premium. I am extremely satisfied with what Sam has achieved for me and I would have no hesitation in recommending either him or Drewberry to friends, family and and business contacts. In the future, Drewberry will be my first point of contact. Many thanks!
Overall Rating
Tailored to my need and the staff gave very good service