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National Pension Tracing Day: Are you entitled to free retirement cash?

Karl 26th Oct 2023 One Comment

Reading Time: 5 minutes

It’s National Pension Tracing Day on Sunday 29 October and as many as 1 in 20 people may have a lost or forgotten pension. It’s a startling statistic – especially when you consider that the average ‘lost’ pension amounts to a whopping £9,500.

So, what else do we know about lost pensions in the UK? And what steps can you take to discover if you’ve any unexpected retirement savings of your own?

Keep on reading for all the details, or click on a heading to jump straight to a section…

What do we know about lost pensions in the UK?

Three million pension pots in the UK have been ‘lost or forgotten’ according to National Pension Tracing Day – a cross-industry campaign group which is urging everyone to check if they’ve mislaid a pension.

The combined value of these pensions is said to be worth £27 billion, with the average pot worth £9,500.

Interestingly, *just* £19 billion was sitting in forgotten pensions back in 2018, meaning the value of lost retirement cash has risen by more than a third over the past five years.

National Pension Tracing Day

National Pension Tracing Day aims to draw attention to the amount of cash siting in forgotten pensions, and encourages people to check if they’ve any cash sitting in a dormant retirement account.

The campaign is backed by a number of businesses involved in the pensions industry including Aviva, Aegon, Legal & General, Standard Life, Scottish Widows, and Hargreaves Lansdown to name a few.

The campaign has been running for three years and the next ‘Pensions Tracing Day’ is Sunday 29 October.

How can you find a lost pension?

Pensions can be lost or forgotten for a number of reasons and, believe it or not, general apathy isn’t the only explanation as to why there are so many individuals with missing retirement cash.

For example, moving house or changing jobs are two very big reasons as to why many workers are likely to have a lost pension, and many of us will go through these milestones several times throughout our lives.

So, if you think you may be sitting on a lost retirement pot of your own, here are 5 tips to help you find it…

1. Draft a list of all places you’ve worked.

Drafting a list of old employers may help you to discover any old pension schemes you may have been part of.

The Pensions Tracing Day campaign suggests trawling through old CVs, payslips, P45s or P60s to help you identify old schemes. And if you’re still in touch with old colleagues on Facebook, LinkedIn or other social media websites, why not message them about any old pension schemes?

2. Check any statement gaps.

If you don’t have a pension statement for a former employer then you may wish to use the Government’s Pension Tracing Service to find the contact details of their pension scheme.

If a former employer has since been taken over you can do some further digging on Companies House or the Government’s Charity Register.

3. Check old addresses & personal details.

When moving home, it’s understandable that notifying your pension scheme provider of a change of address was unlikely to be at the top of your priority list. However, incorrect details on your pension statements can make it easy to lose track of older pension plans.

So, if you’ve moved home within the last few years, check to see if there’s any old pension letters waiting for you at your old address. (Hopefully you’ve a friendly neighbour still living nearby).

Likewise, have a think about any other personal details that may have changed over the years. For example, if you’ve changed your name due to marriage, then do ensure you inform your current pension provider of your old details. After all, you may have lost pension cash waiting for you under your old name.

4. Ask HMRC for further information.

As long as you have your National Insurance number at hand, then you may be able to contact HMRC to help you locate any lost pensions.  That’s because a number of company pension schemes were ‘contracted out’ of part of the state pension system.

Members of these schemes paid a different rate of National Insurance, which should show on old HMRC records.

5. Check the ‘Pension Protection Fund.’

If you had a final salary pension scheme but your former employer went bust with a pensions shortfall, then there’s a chance your pension will have been transferred to the ‘lifeboat’ Pension Protection Fund.  This fund covers 77 schemes, so it’s worth checking if you’ve any entitlement.

Pension tracing: What the experts say

There are, no doubt, many people out there eager to give up work so they can enjoy their later years. So you might assume the majority of people would be on top of their pensions…

Yet it’s fact that there are millions of lost or mislaid retirement pots waiting to be reclaimed, and this is why there’s now a campaign group focusing specifically on this issue.

Alan Morahan, Company Director at Punter Southall – the pensions advisory group responsible for creating the ‘Pensions Tracing Day’ campaign – explains why it’s worth checking for a lost pension.

He explains: “We all lead busy lives but it’s easier than ever to uncover what you may have forgotten about, which could be worth thousands of pounds. In a few clicks or a phone call, you could be better off than you think. Hard times mean making every penny a prisoner so if you’re 55 or over, this could be very welcome or even a lifeline. If you’re younger, isn’t it a good feeling to know that you have more put aside than you thought and you can build on it?”

Meanwhile, former Pensions Minister, Steve Webb, echoes this sentiment: “For people who have had multiple jobs, moved house a few times and not kept pension paperwork, it can sometimes be difficult to re-connect with a lost pension. But it is well worth the effort as some pension pots can be worth many thousands of pounds”.

Private pensions: A brief explanation

Pensions can be a bit of a minefield. For starters, the State Pension – which is based on your National Insurance contributions – is totally separate from private pensions and is managed by the Government. It’s paid to qualifying individuals aged 66+, though this age will be hiked to 67 by 2028, and to 68 some time between 2044 and 2046.

(That’s the official line anyway but, let’s face it, there’s a good chance the State Pension age will almost certainly be raised above 70 within a few decades – assuming it continues to exist at all!)

Whatever your thoughts on the State Pension, however, it’s unlikely to be enough to provide you with a comfortable income in retirement – even if it does manage to survive in future. That’s why it’s vital that all workers today concentrate on maxing their private pension contributions.

Your private pension belongs to you, and can be paid alongside the State Pension. The earliest you can access a ‘defined contribution’ pension (the most popular type of private pension in the UK) is 55 years old – though this age is rising to 57 by 2028. Once you hit this milestone you can withdraw up to 25% of your pot tax-free. With the rest you can buy an annuity (to receive a guaranteed income for life), take money directly from your pot, or do a mix of both.

As we say, pensions is a complex topic, so to learn more take a look at our article which explains all you need to know about pensions.

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MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence

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6 months ago

This is great site

Jasmine Birtles

Your money-making expert. Financial journalist, TV and radio personality.

Jasmine Birtles

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