Do you know how many pensions you have and could you confidently say where they are all held?
The Government predict that there could be as many as 50 million dormant and lost pensions by 2050.
It is estimated that people will have on average 11 jobs in their lifetime, each of which could have a different pension scheme attached. It is also believed that over 60% of people have multiple pensions which they have accumulated over the length of their career. It’s no wonder therefore that many people lose track of the pensions they have – particularly if previous employers have been bought by other companies or the individual has moved home several times and pension companies no longer have a valid address for them.
In 2014 the Government set in motion the Pensions Dashboard as a means for people to see all their pensions in one place. Four years on and the project is still not off the ground. If it does become reality this should help people see all their pensions, almost inevitably prompting many more people to take action to rationalise what they have, potentially consolidating several pensions to make them more manageable.
The advantages of consolidating can be the comparable ease of tracking the performance – particularly where the pension holder or their Independent Financial Adviser selects the investments; being able to apply a uniform investment strategy which is suitable to an individual’s circumstances, having one set of charges, so helping ensure best value for money.
It is also important to look at the benefits. What people also have to look out for is when they are approaching the Lifetime Allowance limit – the total amount they can save into a pension, which currently sits at £1.03million, this can tip them into paying an additional 25% on income and 55% on their lump sum if they exceed it. In particular, this can catch out those with Defined Benefit pensions, which are calculated as 20-times pension, and those with NHS or civil service pensions, especially where, for example, they may have a frozen pension from an earlier employer.
Clearly, it is very hard to plan for retirement without a full view of your pensions savings, as well as an understanding of what your State Pension entitlement is likely to be. As Independent Financial Advisers we can look at the pensions people have and see whether it is worth consolidating or moving a pension depending on the benefits and charges involved. We can also help calculate where they are in relation to the Lifetime Allowance.
The right course of action will depend on a person’s individual circumstances and the type of pension they hold – the wrong course of action or inaction could ultimately prove very costly.
Lowes has been successfully managing people’s retirement planning for decades, helping to preserve family wealth for generations. We will analyse your pensions, savings and investments to provide a range of scenarios that allows you to make informed decisions based on a real understanding of your options. Regardless of whether retirement is still some way off, imminent, or already happened, Lowes can offer assistance and guidance to help put your money to work, as tax efficiently as possible to help provide you with the best potential income and quality of life possible.
As Chartered and Independent Financial Advisers, pension advice is simply one of the many areas which we are qualified to provide advice on. To learn more about how we could help you, attend a forthcoming financial planning seminar. Our seminar will last just over an hour, is free to attend and without obligation.
A small investment of your time could go a very long way. By attending a seminar there is no pressure to ever become a client, but many people do and over 97% of our clients are prepared to recommend us to friends.
Dates Available – Please reserve your place to avoid disappointment
Wednesday 21st November – 11am - Spanish City, Whitley Bay. Click here to reserve your free place.
Thursday 22nd November – 11am – Lowes Head Office; Fernwood House, Clayton Road, Jesmond. Click here to reserve your free place.