Should I Merge My Two Pension Schemes?

bearlady1983

Hello

I've started a new job at a private company and I have joined the employer's pension scheme. I'm wondering if it would be best to transfer my previous pension scheme (local government) into my new one (private) or leave it be and have two. Any advice would be much appreciated. Many thanks.

dunstonh

Probably best to leave it where it is but without knowledge of the receiving scheme and cost/benefits analysis, we cant really say. If your new company scheme is money purchase then it almost certainly would be better to leave it where it is. If it is defined benefit, then it requires a bit more work.

jamesd

If the private one is defined benefit it might be worth considering but most private schemes for new joiners are defined contribution and it would only usually make sense to make a transfer to that if you had seriously reduced life expectancy.

If both are defined benefit pensions then it'd take an IFA a fair bit of work to sort out which offers the deal that is most likely to be best. That wouldn't be worthwhile if you only have a few years worth of membership of the first pension. Too much chance of the charges exceeding the possible gain.

kidmugsy

If you do leave it be, be sure to keep them up to date with your address and marital status.

woolly_wombat

bearlady1983 wrote: »

I've started a new job at a private company and I have joined the employer's pension scheme. I'm wondering if it would be best to transfer my previous pension scheme (local government) into my new one (private) or leave it be and have two. Any advice would be much appreciated. Many thanks.

Your deferred LGPS pension will increase in line with CPI and I'd be inclined to leave it. Pension built up prior to 1 April 2014 can be taken at age 65, but if you decide to do that then you'll face an actuarial reduction on the small amount of pension built up since then (unless you are in the protected older group). The Normal Pension Age is linked to State Pension Age for pension accrued from 1 April 2014.

WW