A guide to pension consolidation

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What is pension consolidation?

Pension consolidation simply means bringing together multiple pensions into a single pension pot. It’s easy to build up a number of different pensions over the course of a lifetime and by consolidating them into one you could save money, and you’ll probably make it easier to manage your pension savings.

If you’ve worked for two or three different employers, it’s possible you could have a workplace pension from each of them. You might also have set up a personal pension, so they can add up quickly.

Before you transfer money out of a pension though, check if your provider will charge exit fees and find out how much they’ll be. You may have valuable benefits and guarantees built up in your existing pensions, you should be clear on any features, benefits and guarantees you could be giving up if you transfer. Please check with your provider to understand what these are. 

But having lots of different pensions could mean paying lots of different charges. It also means you’ve got to think about where you’ve invested the savings in each of your different pensions to make sure you’re keeping an eye on performance. And to get valuations, re-arrange your investments or alter your contribution levels you’ll have to deal with numerous pension providers.

Pension consolidation lets you simplify your pension arrangements and makes it easier to manage your pension savings effectively and efficiently from a single pot. 

What are the benefits of pension consolidation?


If you’ve got lots of different pensions it’s likely they’ll all have different charging structures. You may have to pay an annual management charge to your pension provider for administering your pension and then there could be an investment charge depending on the funds that you’ve invested in.

When you decide to buy and sell investments within your pension, you may also have to pay transaction fees. If you contact your provider they’ll give you a full run down of the charges that apply to your scheme.

These charges will vary from one pension provider to another and be affected by the type of pension scheme you’re in and the size of your pension pot.

Before you transfer money out of a pension though, check if your provider will charge exit fees and find out how much they’ll be. You should also be clear on any features, benefits and guarantees you could be giving up if you transfer - these benefits can be very valuable. Again, check with your provider to understand what these are. 


Managing one pension is easier than looking after lots of pensions. Instead of getting statements from different providers at different times you’ll only receive one that details all of your pension savings.

If you consolidate by transferring into your workplace pension, you’ll get access to a digital proposition that makes it quick and easy to look after your pension savings online.

The best digital pensions offer a range of tools and calculators so you can understand how much you need to save to afford the lifestyle you’d like in later life. You can set targets to help you reach your goals and receive prompts and reminders to make sure you’re managing your pension savings effectively.

By consolidating your pensions you might make it easier to get an overall picture of your savings, giving you a better understanding of exactly what you’ve got and exactly how much more you'll need. 



Out of sight is out of mind and if you’ve got pension savings gathering dust in an old workplace pension then you’re probably not paying as much attention to their performance as you should.

By pulling all of your pension savings together into a single pot, you can see how much you’ve got, where it’s invested and how well it’s performing. This single view could make it easier to assess performance and to make changes where necessary.

This approach could also make it simpler to ensure you’ve got the most appropriate spread of investments in terms of your circumstances, your attitude to risk and your retirement goals. Remember the value of investments can go down as well as up, you may not get back the amount you invest. 

Good housekeeping 

Every penny counts when saving for retirement, but it’s not uncommon for people to forget about a pension plan. Auto-enrolment legislation means that employers now have a duty to enrol eligible employees into a workplace pension and although you can opt out if you want, it’s likely that more people will end up with more pensions as they move through their careers and change jobs.

It’s more important than ever, therefore, to keep close tabs on the pensions you’ve got and to think about consolidating them so that you don’t lose track of any of your savings. If your paperwork isn’t up to scratch you can contact the Pension Tracing Service to track down a missing workplace pension or The Pensions Advisory Service to find details of a personal pension.   

If it’s a personal pension you’ll need the name of the provider and if it’s a workplace pension then you’ll be asked for details including:

  • The name of the employer or pension scheme (or group name)
  • The employer's type of business
  • Dates of employment
  • Your job title
  • Date you joined the scheme
  • Last known address of the employer

Consolidation in practice 

So just what’s involved in transferring a pension and consolidating them all into one? You’ll need to have the details of the pension scheme you want to transfer your savings out of including, the name of the provider and the policy, account or plan number. You’ll also have to have a rough estimate of the value of your pension pot, your National Insurance number and your bank account details.  

Armed with this information, you then contact the provider you want to transfer your pension savings to. Depending on the provider you’re moving to, you’ll be able to do this either over the phone or online. Once you’ve instructed your new provider to carry out the transfer, they’ll contact your old provider and take care of all of the administration.

You should expect this to take around 4 weeks depending on the provider(s) you are transferring from.  

Make sure pension consolidation adds up to a good deal

Understand your existing pension charges 

You can get a full list of all of your pension plan charges by contacting your provider. They’ll also be able to tell you how much it’ll cost to transfer your savings out of the scheme.

When you’ve got all of the information on the charges that apply to your different pension schemes, you’ll then be able to make a comparison and identify those that are more expensive than others. 

What are you giving up? 

Pensions are important and so it’s crucial that you take time to understand exactly what you’ve got and exactly what you’d be giving up when you transfer out of an existing pension.

Before you transfer any pots, you need to be sure that you’re not giving up any protected benefits like tax-free cash or low pension age. You should also consider any features your plan has like guarantees or life assurance benefits.

Remember that what you get back depends on several things, for example how your investments perform and how they're taxed, and you may get back less than you invested.

Need guidance? 

If you’re in anyway unsure about consolidating then our Aegon Assist service will give you access to trained specialists who can guide you through the decision making process allowing you to make your own choices about your retirement savings. We don’t offer advice, but if that’s what you need you should speak to your financial adviser.

The most important thing is that you take the time to understand your options(Opens new window) and make the most appropriate choices for your financial future. That way you can make sure you get the most out of the pension savings you’ve got and don’t pay more than you have to in charges.