In Focus: Retirement Income  

Fewer savers losing track of pension pots, research finds

Fewer savers losing track of pension pots, research finds

Although the number of savers with multiple pension pots has increased, people are getting better at keeping track of their retirement income, Aegon has found.

Research from Aegon, published yesterday (May 3), found 73 per cent of people, out of nearly 730 surveyed, have a number of pension pots - an 11 per cent increase since Aegon carried out a similar survey in 2016.

But the number of people within this group who had misplaced one or all of their pensions dropped slightly from 21 per cent to 17 per cent.

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While this is positive, Aegon warned this still means about 6.4m people aged between 22 and 65 may have lost some of their savings.

The research also found people’s awareness of their pots had increased in the last five years, with an 18 per cent fall in the number of people not knowing the value of their pensions from 39 per cent in 2016 to 21 per cent.

Aegon found the main reasons people lose track of their pensions were that the pension company has been taken over or rebranded, paperwork was lost or people had moved and had not informed their pension provider or employer.

Of those who had moved home, 13 per cent said they had never notified their pension providers of their change of address.

When given the choice of options, almost half of savers knew to use the Pension Tracing Service from the Department for Work and Pensions or to contact their previous employer (42 per cent) to find a lost pension.

But 18 per cent of people had no idea how to find a lost pension.

Kate Smith, head of pensions at Aegon, said it was no surprise the number of people with multiple pots had increased as almost every job now comes with its own pension.

She added: “It’s really positive to see a fall in the number of people who have lost track of their pensions, which could indicate that people are becoming more conscious of their workplace pensions.

“This doesn’t mean that we can put the challenge of lost pension pots behind us just yet. In fact, as the number of pension pots per person grows through a lifetime of work and while we await the delivery of pension dashboards, there’s a growing risk that losing track of pensions could become more common.”

Smith said smaller pots were especially difficult to track as they are easy to forget about.

She said: “But the value of many small pots should not be underestimated, they can still play a fundamental part in planning for retirement and improving financial wellbeing now and in the future.

“It’s not the end of the world if you’ve mislaid some of your pensions, you can easily reconnect by using the DWP’s tracing service or contacting your previous employers or pension providers. You might be pleasantly surprised about what you find.”