October can be a scary month; the nights are drawing in and All Hallows’ Eve takes pride of place on the very last day. There is, however, a far more important day that takes place around the same time and very few of us are aware of it. The 29th October is National Pension Tracing Day, I admit it’s not a very catchy title, it doesn’t need to be. It’s a day to be celebrated for helping thousands of people re-acquire their share of the previously reported £26.6 Billion* in unclaimed pension pots.
The lost pension challenge
Over the years, individuals change jobs, move residences, and sometimes simply lose track of their pension accounts. This results in a significant number of people having pensions scattered across different providers, potentially going unclaimed.
The consequences of neglecting these lost pensions can be dire. Many individuals face retirement with inadequate financial resources, not realizing they have funds from previous employments waiting for them. This is where pension tracing becomes imperative.
Why tracing your pension matters?
You may think why bother, they’ll find me. Well, maybe they won’t. It’s worth putting the effort in now, it’s not that difficult and it could be worth thousands in the future.
Apart from being YOUR money, here are 4 other reasons to trace.
- Pension providers charge to administer your pot. You could save money by finding and moving your pension to a provider with lower charges. (I think you may have guessed why I wrote this article!)
- You could combine old pension pots into one, making everything easier to manage and keep track of, although you may want to take advice before doing this.
- You could choose investments for your pensions that are more in line with how you feel about investment risk
- Find a lost pension, and you’ve instantly got more retirement income.
Beware of pension scammers
As with all financial services it is always wise to tread carefully, there plenty of pension scammers want to steal your money. According to the Financial Conduct Authority (FCA), pension scammers swindled people out of more than £30 million between 2017 and 2020.
TPD Wealth Management recommend following these simple tips to stay safe:
- Unknown contact – Be wary if someone contacts you unexpectedly. This might be an email, phone call or social media message – especially if they offer a ‘free pension review.’
- One-off opportunities – Take care if you are offered a ‘rare’ or ‘one-off’ investment opportunity, particularly if it also comes with promises of high or guaranteed returns. Investment returns can’t be guaranteed and moving money overseas makes it harder to trace.
- Loopholes – Watch out for people who claim they can help you exploit pension ‘loopholes,’ such as helping you access your pension pot before the age of 55. Except in rare circumstances such as ill-health, you can’t do this without incurring a tax charge.
- Being rushed – If you find yourself being pressured into making a decision – perhaps because the investment is a ‘time limited’ offer – then it should likely be avoided. Reputable organisations will give you time to think and change your mind.
Start trace your pension with our handy guide
On this National Pension Tracing Day, we’re excited to introduce our comprehensive guide to pension tracing. It’s a resource designed to empower you with the knowledge to locate and access your pensions. This guide covers everything from the initial steps to planning your retirement journey, ensuring you have all the information you need to take control of your financial future.
Download step by step guide here
* Pension Policy Institute Briefing Note 134 – Lost pensions 2022
