If you have accumulated different pension plans, keeping your pension savings in different plan schemes may result in lost investment opportunities and unnecessary exposure to risk. Making the most of your pension plans now could have a significant impact on your happiness in retirement; getting it right could mean a higher income, or even an earlier retirement date.

The most obvious reason for moving a pension is to obtain better investment performance and lower charges to potentially increase your retirement income. But you need to be aware that you could be subject to exit penalties on your existing fund, and if you are close to retirement, you might not have time to recoup the costs, even if you do move to a better performing fund.

different types of pension

You might well have several different types of pension. Final- salary schemes pay a pension based on your salary when you leave your job and years of service. If you have any past or current contributions in a final-salary scheme, it’s usually advisable in nearly almost every situation not to move it.

But if you’ve got any other kind of pension – a money purchase occupational scheme or a personal defined contribution pension – it may be appropriate to consider bringing your historic pensions into one place.These pensions rely on contributions and investment growth to build up a fund.A key advantage of moving your funds into one pension pot is the ability to monitor fund performance more easily.

Consolidating your pensions into one pension wrapper can make keeping track of your pension savings more easy: you can keep a closer eye on the value of your savings and it could also potentially reduce the amount of management fees you are paying. It will also make things much easier when you eventually retire and want to start drawing on your pension savings.

Not all pension consolidations will be in your best interests, and you should always look carefully into the possible benefits and drawbacks and, if unsure, seek professional financial advice.


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
  • 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


review your exisTing pensions

It’s vital that you review your existing pensions to assess whether they are still meeting your needs. Some older plans from pension providers that have been absorbed into other companies have pension funds which are no longer open to new investment – so-called ‘closed funds’. As a result, focusing on fund performance may not be a priority for the fund managers.

These old-style pensions may often impose higher charges that eat into your money, so it may be advisable to consolidate any investments in these funds into a potentially better performing and cheaper alternative.

economic and market movements

It’s also worth taking a close look at any investments you may have in managed funds. Most unit-linked pensions are invested in a single managed fund offered by the pension provider and may not be quite as diverse as their name often implies.These funds are mainly equity-based and do not take economic and market movements into account.




Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change.Tax treatment is based on individual circumstances and may be subject to change in the future. Although endeavours have been made to provide accurate and timely information, Lloyd & Co cannot guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough review of their particular situation.We cannot accept responsibility for any loss as a result of acts or omissions.