Martin Lewis addressed pension consolidation in his most recent Money Show episode. In the modern working world it is common for workers to build up several pensions as they move between jobs and this could increase the chances of savings going missing or costs being raised.
“Compare all what she’s got, the charges, the fees, look at the costs and decide what she actually wants to do but just be careful before you move them.”
According to the Money Advice Service, there are a number of advantages in consolidating pension pots, which includes:
- Keeping on top of and managing pension savings more easily
- The potential for saving money if a high-cost scheme is transferred to a lower-cost one
- Potentially opening up a greater choice of investments if one is consolidating pension pots into one flexible scheme
Martin concluded on this topic by noting independent pensions advisors can help with consolidation matters.
The Pension Advisory Service notes accepting pension providers may insist that savers should get prior regulated financial advice before moving any assets.
For those looking to transfer a private sector (funded) defined benefit pension scheme or a funded public sector defined benefit pension scheme into a defined contribution pension scheme, they will need to take financial advice if the value of the benefits are above £30,000.
The reason for this is to ensure valuable perks are not lost and impartial guidance on all pension matters can be sought from the like of Pension Wise and Citizens Advice.
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