Pensions - Articles - Older savers least likely to consolidate multiple pensions

Older savers aged 55 and above are more likely to have multiple private pension pots (33% vs. 31% of all UK adults with a private pension) but are the least likely of any age group to have considered consolidating them (31% vs. 58%), new research from Canada Life reveals.

 The findings highlight the valuable role that advisers can play in helping savers to get the most out of their pensions as they approach retirement, especially given the average UK worker will have had 11 jobs2 by the time they look to access their pensions.

 Savers may be looking to consolidate all of their pension savings in one place for simplicity and flexibility, suggests Canada Life.

 While only 23% of younger savers aged 18-34 have multiple pots, this rises to 33% of those aged 55 and above, including 11% who have three or more pots.

 However, while nearly three quarters (72%) of younger savers with multiple pots have considered consolidating them, this falls to less than a third (31%) of those aged 55+.

 Base: UK adults with a private pension

 Andrew Tully, technical director, Canada Life commented: “Pension consolidation behaviour is likely to be driven by two factors. The first is the increase in auto-enrolment coverage and the number of people who will have accrued multiple pensions over their career. The second is the demand for more flexible solutions to meet the expectations of the freedoms as people start to take income from their pensions.

 “Pension consolidation is a perfect advice opportunity so it’s interesting to see our research with the over 55s suggesting this group is the least likely to have considered it. This could be because of the mix of pension coverage with this group, namely DB and DC. Or it could be people are mentally compartmentalising their savings into various pots and spending priorities as they plan retirement.

 “There are clear benefits to review and consolidate pensions, but it isn’t always the right move, as some older pension schemes may have valuable benefits that can be lost following a transfer, such as guaranteed annuity rates. An adviser will clearly be best placed to take a holistic view of a client’s wealth and priorities at-retirement and decide the best plan for the future.”

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