Do you know how much money you’ll have during your retirement?
Here are 5 compelling reasons to check your pension and make sure your retirement is on track.
5 Reasons to Check on Your Pension
1. It Might Be Worth More Than You Think.
There is a whopping £400 million of unclaimed pension savings in the UK. Until you double-check, you can’t be sure that you’ve accessed all the pension available to you.
2. Your Workplace Pension Can Be Woefully Mishandled
It’s essential to keep track of how much you have in pension schemes, for optimal planning and in order to make sure that you haven’t been a victim of a mis-sold pension.
Mis-selling happens when a pensioner is persuaded to take their solid, workplace investment and put it into a much more risky pension plan and were not told about all the risks involved. In 2018, a report estimated that only around 50% of defined benefit schemes had been suitably advised of the risks of their transfer.
It’s important you review monthly statements to see how your pension investments are performing. If you believe you have been a victim of fraud or have any doubts it’s always a good idea to ask for some help and advice. There are a number of resources available to you. You can start by speaking to a pension lawyer who can review your situation for free.
3. Check To Make Sure Your Money Is Working For You.
A Self-Invested Personal Pension (SIPP) is a “money purchase scheme” which means that its worth depends on how much money the pensioner has invested, and how well those investments have performed over time. If you have a SIPP, your financial advisors should make sure you have all the information you need to access information about your pension and how it’s performing.
There are lots of reasons why someone might choose to go with a SIPP. Unlike the pensions you get from the government, SIPPs offer more flexibility, and allow you to borrow money for things like a mortgage.
But for the vast majority of people with workplace pension funds, keeping money in those pensions is a good idea. It might make sense to try a SIPP in addition to a workplace pension, however many financial advisors warn that people nearing retirement should avoid jeopardising their retirement.
4. What Type of Pension You Have Can Affect Your Retirement Age.
Private pensions also have different rules about retirement ages and bonuses in the case of late retirement. Check on your pension to make sure you’re able to start withdrawing from your pension the year you plan to retire.
5. You Earned It. Why Not Take It?
How you plan for your retirement is up to you. But no matter how you want to set up your finances, take this basic step to ensure you don’t leave any money on the table.
If you’re not sure how to access your workplace pension, contact your former employer for information about how to proceed. For a personal pension, your financial advisor should be able to provide you with information about how to view your pension. The Department for Work and Pensions also provides a free service that helps track down lost pensions.