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Pension Consolidation – Our Company & Service

During your working life, you may have built up pension pots with several employers (workplace pensions). This can often make it hard to keep track of them all and manage them well. 

Pension consolidation is when you combine all of your pensions into one single account. It’s not uncommon to have several pensions with different providers as you work for a wide range of different companies throughout your career.

It’s not always best to consolidate your pensions, as some come with additional benefits that are lost on transfer, so you may find it’s better to remain in an existing pension scheme.

Ultimately, it’s important to get professional independent advice before making any final decisions and make sure you understand all the implications of any decision. Keep reading to find out how this affects you…

Pension Consolidation Company

As pension and retirement planning specialists we’re perfectly positioned to advise on whether or not pension consolidation is right for you. We take a holistic view of what you want now and in the future to find the right way forward for you. 

Our Service

Before we can even consider a pension switch, as part of our Lifestyle Financial Planning process, we spend a great deal of time getting to know what it is you want from life going forward. Once we understand this, we can then advise on how you can make the most of your pensions to achieve your goals.

When we know what you want, we go to work on the technical side looking at all your existing pension pots, the benefits associated with them, and any penalties and fees involved with switching them. 

If we all come to the same conclusion that a pension switch is beneficial to you and the best way forward from a technical and holistic point of view, then we handle all the administration so you have peace of mind, everything’s taken care of and a single point of contact to support you going forward.

Pension Consolidation – understanding your options 

There are lots of factors to take into consideration when it comes to consolidating your pension savings. It’s important to compare these to your specific circumstances and weigh the importance of these against your personal needs.

Not all considerations are purely technical,  listed below are some of the key points you should be looking at. As part of our  retirement planning advice service, we’d analyse each of these points for you

Consolidating existing workplace pensions

A personal pension should not be considered as a replacement for a workplace pension which benefits from tax relief at source and an additional contribution from your employer of at least 3%. 

Active workplace pensions benefit from contributions from both employees and employer. Fully switching these pensions to a different provider could cause you to miss out on money paid into your pension

Another point to consider is that workplace pensions generally have lower charges. Sometimes this is because they don’t offer the full scope of flexibility when it comes to accessing the pension, but while the individual is employed they may not need to access it.

Additionally, workplace pension schemes are often invested in default portfolios. These are designed to be exposed to higher risk during the accumulation phase and reduce this level of risk as you approach retirement age.

Again, it’s important to consider your needs: if you plan to retire from work at 60, but want to access your pension at 55, the default lifestyle strategy may not be suitable for you.

There are costs involved

When it comes to moving pensions around it can be a very time-consuming process for you personally, as well as that the actual transfer process can take anywhere from 2 to 5 weeks. There may also be fees associated with leaving your existing providers. These costs may well make it less beneficial to move your money. 

The value of your pension pot is not guaranteed

How you feel about risk will change as you go through different stages of your retirement. Typically speaking, a person’s attitude towards risk decreases as they get older. This is reflected by their increased reliance on investments to fund retirement lifestyle. Striking the balance between having your pension invested and guaranteed income is something to think about now and in the future

Make sure your pension is invested inline with your needs

You want to make sure the options available meet your investment needs, now, leading up to, and all the way through retirement. Your pensions might be performing really well where they are but to know this, you’d have to know your investments and how they vary in each pension.

Consolidating your pensions could simplify this for you as you’d be able to invest them in the same funds, making it much easier to manage.

This is also something we could help with – we love to simplify, to empower our clients and as part of our service we’ll assess your needs and objectives, coupled with your thoughts around investments and the analysis on what you could potentially lose if the markets performed badly, and we’ll determine the most suitable investment strategy for you.

Benefits of Pension Consolidation 

There are quite a few advantages and disadvantages to pension consolidation shown in the table below: 

Advantages of Pension Consolidation Disadvantages of Pension Consolidation 
You can move your pensions from one provider who is underperforming to another with higher returns. Your existing schemes may well have some very attractive benefits that you don’t want to lose.
You can look to get rid of the higher charging plans. You may be able to take a higher than normal tax-free lump sum which you’ll lose if you transfer out.
It’s far easier to track and manage one pension pot than multiple.  If your pension is invested in a with-profits fund, then there may be a Market Value Reduction* applied.
It may be easier to buy the annuity you want if you have all your money in one place. With several smaller investments you can take three pots worth up to £10,000 without affecting your annual or lifetime allowance. 

*A Market Value Reduction is a reduction to the amount paid out from a with-profits policy. It is used to protect the interests of policyholders who remain invested in with-profits.

For many people, asking an independent financial adviser, specifically one who specialises in pension advice, to look at their pensions is the best option to fully understand all the routes available. That way you can be sure that all the important factors are taken into account. 

A fictional example.

Here’s an example of a fictional client pension consolidation.

David has worked for an accountant for a few years and work is dominant in his life.

He’s 55, hasn’t taken any advice on his pensions and has left them where the employer put them. This means he has several pension pots of various sizes all over the place.

He wants to understand his financial position better and find out whether he can afford to retire.

His four pension pots are:

  1. An old company pension plan with provider A with a fund and transfer value of £45,000
  2. A pension plan with provider B with a fund and transfer value of £40,000
  3. Personal pension plan with provider C, which David is currently paying and has a fund value of £35,000
  4. Current company pension with provider D, which David is currently paying into and has a fund value of £20,000

Taking David through the PlanHappy process, we discussed what retirement looks like for him including the costs associated with any retirement hobbies, holidays, or events he has planned, and the assets needed to fund them.

Following this, the team got busy working on getting all the information from his pension providers before the paraplanners calculated this into several options for David to choose from – taking into account the lifestyle goals he wants.

This was then mapped into a plan giving David his desired goals and how his assets can fund it. We were able to present David with a positive plan that allowed him to retire immediately and do all the lifestyle desirables he wanted.

David was astounded he could afford to retire straight away and decided to consolidate his pensions into drawdown and retire immediately.

How do I consolidate my pension?

There are two routes you can take when it comes to pension consolidation. You can do it yourself with general, non-specific, free guidance available at the pension advisory service,  or you can use a specialist independent financial adviser to get tailored advice about your specific circumstances.

Can I transfer my pension myself?

Yes, If you want to transfer your pensions yourself:

You’ll need to trace all of your pensions and pension providers, you can do this using the free online service on .GOV service find pension contact details.

Once you’ve traced all of your pensions it’s worth having a chat with either:

Money Advice Service or

Pension Advisory Service

From there, if you’ve made a decision about what you want to do, you would contact the existing providers and advise them of your decision to leave.

Fill in paperwork to move pension to a new/existing provider.

Seeking independent financial advice to help me consolidate my pension pots

If you’re unsure about anything it’s often best to seek advice from retirement and planning specialists. There are usually costs associated with using that service but the trade-off between what you spend and what you actually save yourself often makes it a worthwhile exercise. 

When you’re looking for an independent financial advisor:

Ask your friends, family, colleagues who are retired which financial advisor they used and what their experience was like.

You can search Google for ‘retirement and planning specialists near me’

Once you’ve shortlisted certain candidates it’s always worth checking the FCA register to make sure they’re fully licensed.

Be sure to check all the testimonials and reviews.

Phone and make a booking. 

When looking at your retirement savings and considering your retirement income it’s best to use a pension and retirement planning specialist that takes a holistic view of your situation. 

The things you enjoy doing, as well as how you feel, at 55 compared with 85 will be worlds apart. Here at Joslin Rhodes, we spend a great deal of time getting to know what you want from life, now and in the future. We then use all the tools at our disposal to get you to your ideal retirement lifestyle. 

Here’s how it works:

You book a free, no-obligation meeting, with one of our pension and retirement planning experts.

We listen to exactly what you want. We might ask some tough questions but it’s all to get you thinking about everything that’s important.

We produce a detailed personal report containing what to do with your pensions, savings, and investments to achieve the financial plan.

You can take your plan or if you like we can manage your pensions and investments. 

If you’re ready to talk click the button below to arrange your meeting.

Can I combine my pension into one pot?

If one or all of your pension pots are Defined Benefit pensions (Final Salary pension), then moving or transferring that pot will be very difficult because it will most likely offer a guaranteed income for life and protection against inflation.

Defined contribution (money purchase) pension pots are usually a lot easier to combine but just because you can doesn’t always mean you should. A specific type of advice is required, completed by a Pension Transfer Specialist, due to the guaranteed nature of the benefits you can receive from a Defined Benefit pension.

What pensions can’t I consolidate?

Different providers have different rules on consolidating pensions. You’ll have to check if the pot you’re trying to consolidate everything into will accept: 

  • A pension that has safeguarded benefits; 
    • a Defined Benefit pension scheme (Final Salary)
    • has a Guaranteed Annuity Rate (GAR)
    • has a Guaranteed Minimum Pension (GMP)

Income Drawdown or Flexi-Access Drawdown pension. This is when you’ve taken tax-free cash from your plan while leaving the remainder of the money invested for you to access money flexibly, as and when you need it.

A pension invested in a with-profits fund. (A with-profits investment fund is a mixture of assets that pays a guaranteed amount in certain circumstances)

A Self-Invested Personal Pension (SIPP) requires investments to be transferred in their present form (‘in-specie’) rather than cash.

Any active workplace pension that receives contributions from you and/or your employer.

Should I combine my pension pots?

When considering whether or not you should combine your old pension pots it’s best to make sure you’re not giving up any valuable benefits or being hit with any substantial exit fees. 

It’s always worth checking your existing schemes for:

What type of scheme is it, defined benefit pension or defined contribution? Defined benefit schemes offer guaranteed income and protection from inflation.

If there are any valuable guarantees or benefits that come bundled in with your existing pension schemes. 

Certain pension providers offer life cover and critical illness insurance. These are two big things to look out for.

You’ll need to be aware of the exit fees on your existing pension schemes and how they affect your pension savings.

You might want to take advice from a professional if you’re considering consolidating your pensions. An adviser on what is best to do with your pensions and will make sure that the benefits of doing so are not lost and can offer expert advice on how best to manage your money in retirement to make sure you have enough, and always have enough.

Is pension consolidation a good idea?

Pension consolidation is a good idea, by having all your pension pots in one place you’ll only be paying fees to one provider and have complete control over your exposure to risk.

With people changing jobs quite frequently you may end up with multiple pension pots scattered across many different providers and it can be quite tricky to stay on top of them all. There are a number of benefits to pension consolidation 

Having all your money in one place

It can be quite tricky to track multiple pension plans, having all your money in one place simplifies everything for you and gives you a quick and easy way to see how your retirement fund is looking.

Lower Fees

Consolidating your pensions may mean that you have fewer fees to pay, simply because you’re only paying one, this in turn gives you more money for your retirement.

Better performing portfolio 

Having one single plan means you have complete control over your exposure to risk, across your entire portfolio. It’s always worth remembering that past performance isn’t a guarantee of future returns but you can manage this diligently by having everything in one place. 

Ease of Access to your pension 

Some pension providers can be quite old-fashioned in their approach, e.g. they still only communicate by letter or they may have old and cumbersome digital access. 

By consolidating you can choose a provider that provides easy access to your portfolio for you to manage. 

Do I need financial advice to combine pensions?

You will only be able to transfer your defined benefit pensions (Final Salary pensions) by getting regulated advice if the value is above £30,000. However, there’s no legal requirement to seek independent advice when you’re considering combining defined contribution pension (money purchase, personal pension).

It’s always best to speak to a financial adviser, authorised and regulated by the FCA, when you’re looking to combine your pension schemes as they will analyse whether it’s the right option based on your individual circumstances.

How much will consolidating pensions cost?

There’s no exact figure for how much it will cost to consolidate your personal pensions and the exact impact it will have on your retirement savings and your retirement income because the cost to exit your schemes will be different depending on which schemes you’re enrolled with. 

An independent financial advisor will talk you through all the associated costs so you’re clear about what options are right for you. What is pension consolidation

How long does it take to consolidate a pension?

It can take 4 to 16 weeks to trace and gather the required information from previous employers on your old pensions. Once the information has been collated, the process of pension consolidation (pension transfer) will take between 2 to 5 weeks. The timescale is dependent on the pension scheme providers and how quickly they act.

By speaking to a pension and retirement planning specialist they’ll be able to give you accurate timescales for your individual circumstances. 

Can I cancel my consolidation?

At any point in the process you can choose not to combine your pensions, but once you sign and agree, the process will take place even if you want to change your mind.

That’s why it’s always best to speak to an independent financial advisor about combining pensions, so you’re sure it’s in your best interests. 

Can I withdraw my pension if I leave the company?

Typically most pensions can be accessed when you turn 55, however, if you’ve worked at a company for less than two years, you may be able to get a refund on what you’ve contributed, but this does depend on the type of defined benefit scheme you have and its rules.

Do I need to consolidate my pension to retire?

Pension consolidation is something everyone should consider based on their own personal circumstances but it’s not always the best thing to do. You don’t need to combine your old pensions to retire and if you’re unsure of what to do it’s well worth seeking regulated advice. 

Pension consolidation is one tool you can use to facilitate the lifestyle you want. At Joslin Rhodes, we take the view that you know what’s best for you, so we spend a great deal of time finding out what ‘happy’ looks like to you. 

Once we know what ‘happy’ looks like we then go to work, looking to see if you can afford to live the life you want in retirement. Sometimes that involves consolidating pensions, sometimes it doesn’t, we won’t know until we’ve answered the bigger questions. These questions may be ‘How can my pensions help me achieve my desired retirement lifestyle?’, When can I retire?’, ‘Do I have enough to retire?’. 

Our unique PlanHappy process will give you the answers you need to live the life you want without worrying you’ll run out of money. 

Here’s how it works:

You book a free, no-obligation meeting, with one of our pension and retirement planning experts.

We listen to exactly what you want. We might ask some tough questions but it’s all to get you thinking about everything that’s important.

We produce a detailed personal report containing what to do with your pensions, savings, and investments to achieve the financial plan.

You can take your plan or if you like we can manage your pensions and investments. 

If you’re ready to talk click the button below to arrange your meeting.

Book your free no-obligation chat


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We're trusted to manage over £190 million of our clients funds

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We're authorised and regulated by the Financial Conduct Authority

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The unique PlanHappy Lifestyle Financial Planning process has been specifically designed to help you get what you want

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