Rise in pension savers with multiple pots

The number of people with multiple pension pots has climbed by 11% in the last five years, new research from Aegon has revealed.

The pension provider revealed that 73% of people now have multiple pensions, having climbed from 62% when Aegon conducted a similar survey in 2016.

However, the number of people within this group who have lost track of one or all of their pensions has reduced slightly, from 21% to 17%. Aegon estimated this still means that around 6.4 million people aged between 22 and 65 could have misplaced some of their retirement savings.

Aegon’s recent survey, which was based on 727 adults aged between 18 and 64, also implied an improvement in pension awareness in the last five years, with an 18% fall in the number of people not knowing the value of their pensions, from 39% in 2016 to 21% now.

“As nearly every job comes with a pension now, it’s no surprise that the number of people with multiple pension pots has increased over the years,” Aegon head of pensions, Kate Smith, commented.

“It’s really positive to see a fall in the number of people who have lost track of their pensions, which could indicate that people are becoming more conscious of their workplace pensions.

“This doesn’t mean that we can put the challenge of lost pension pots behind us just yet. In fact, as the number of pension pots per person grows through a lifetime of work and while we await the delivery of pension dashboards, there’s a growing risk that losing track of pensions could become more common.”

Aegon’s latest survey also explored what caused people to lose track of their retirement savings. The pension provider found the main reasons people lose track of their pensions are because the pension company has been taken over or rebranded, paperwork was lost or people had moved home and hadn’t informed their pension provider or employer. Of those who had moved home, 13% revealed they had never notified their pension providers of their change of address.

Furthermore, when given the choice of options, Aegon found that most people (48%) knew to use the Pension Tracing Service from the DWP or to contact their previous employer (42%) to find a lost pension, but 18% of people also said they had no idea how to find a lost pension.

“The smaller pensions pots from earlier in people’s careers are especially difficult to keep track of,” Smith added.

“People are unlikely to have invested much financially but also emotionally in smaller pension pots, especially if they are some way off from retirement, which makes them easy to forget about. But the value of many small pots should not be underestimated, they can still play a fundamental part in planning for retirement and improving financial wellbeing now and in the future.”

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