It is important to keep track of your pension portfolio. It’s vital to ensure that you get the best out of the contributions you’ve made, and keep track of your pension portfolio to make sure it remains appropriate to your personal circumstances at different points in your life. Consolidating your existing pensions is one way of doing this.
Pension consolidation involves moving, where appropriate, a number of pension plans – potentially from many different pensions’ providers – into one single plan. It is sometimes referred to as ‘pension switching’. Pension consolidation can be a very valuable exercise, as it can enable you to:
- Bring all your pension investments into one easy-to-manage wrapper and see everything in one place.
- Identify any underperforming and expensive investments with a view to switching these to more appropriate investments.
- Accurately review your pension provision in order to identify whether you are on track.
Traditionally, personal pensions have favoured with-profits funds – low-risk investment funds that pool the policyholders’ premiums. But many of these are now heavily invested in bonds to even out the stock market’s ups and downs and, unfortunately, this can lead to diluted and low returns for investors. It is vital that you review your existing pensions to assess whether they are still meeting your needs – some with-profits funds may not penalise all investors for withdrawal, so a cost-free exit could be possible.
If you’d like some more advice on your pension, why need get in touch today.