Pension Consolidation Advice

Fed Up With the Admin of Several Pension Plans

At Sancus retirement Planning Limited, we carry out specialist analysis and reporting on old work based and personal pension plans for clients, to assess the suitability of a potential consolidation.

 

What is pension consolidation?

 

Pension consolidation simply means bringing together multiple pensions into a single pension pot. It is easy to build up a number of different pensions over the course of a lifetime and by consolidating them into one place, you could save money and you could make it easier to manage your savings.

 

Having a host of different pensions could mean paying lots of different charges. It also means that you need to consider where the funds have been invested in each of your different pensions, thus making sure that you are tracking investment performance.

 

Pension consolidation lets you simplify your pension arrangements and makes it easier to manage your pension savings effectively and efficiently from a single pot. 

 

What are the benefits of pension consolidation?

 

Financial

If you have lots of different pensions it is likely they will have different charging structures. You may have to pay an annual management charge to your pension provider for administering your pension and, in addition, there will be an investment management charge and depending on the funds that you have selected, the charges may well vary. These charges will vary from one pension provider to another and be affected by the type of pension scheme you are in and the size of your pension pot.

Before you transfer money out of a pension, check if your provider will charge exit fees and find out how much they will be. You should also be clear on any features or benefits you could be giving up when you transfer. Examples of these could be things like guaranteed annuity rates or bonuses, but it’s important to check with your provider to understand exactly what these are.

 

Convenience

Managing one pension is easier than looking after lots of individual ones. Instead of getting statements from different providers at different times, you will only receive one that details all of your pension savings.

By consolidating your pensions you might make it easier to shepherd your savings and give yourself a better understanding of exactly what you have got and exactly how much more you need. 

 

Performance

For many people, out of sight means out of mind. So, if you have pension savings gathering dust in an old scheme, you might not be paying as much attention to their performance as you should.

By pulling all of your pension savings together into a single pot, you can see how much you have invested, where it is invested and how well it is performing. This single view could make it easier to assess performance and to make changes where necessary.

This approach could also make it simpler to ensure you have the most appropriate spread of investments in terms of your circumstances, your attitude to risk and your retirement goals. 

 

The Solution 

In our experience, the best vehicle to house a consolidation exercise is gathering the various pensions and creating a Self Invested Personal Pension (SIPP). A SIPP provides the best of all world’s in that you benefit from the ease of admin having just one contract, but you will also be able to set up a well diversified investment portfolio ensuring that not all of your eggs are in the one basket.

 

Please contact info@sancusrp.co.uk for more information, help and guidance on our dedicated Pension Consolidation Service.