Advice On What To Do With 5 Small Work Pensions.

mystic_bertie

Hello Guys. I have had a chat with Pension Wise in the past, it was ok but they advised that i speak to a financial adviser regarding what to do with my 5 work pensions. Im 56 and i retire in 11 years, im not working due to multiple health problems. I get PIP and UC.

I have always grudged paying into a pension, thats why my efforts are so poor. Is anyone able to advise me if i should perhaps transfer them all into 1 pot. I dont fancy paying a financial advisor.

Aviva £2,118 paid in - '£3210 or £233 per year at retirement'

General Electric - £3513 paid in 2007 - '£8,386.84 a year or £ 42,157.54 + £ 6,323.63 a year'

L&G - £375 paid in - '£438 or £29 a year at retirement'

Peoples Pension - '£1207 - £2134 at retirement'

Smart Pension - £493 - '£658 at retirement'

State Pension - '£12,014 year'

DRS1

Did Pension Wise talk about defined benefit (DB) and defined contribution (DC) pension schemes?

The General Electric one looks as if it may be a DB scheme. If it is you would probably be advised to leave that one alone.

I confess I am not sure about the others. I assume they are DC. But you quote figures "at retirement" and in some cases as annual pension but retirement is some way away so how can anyone know with a DC scheme what you might get then? It may make more sense to look at their current values the current fees and what they are invested in.

You have added the state pension in at the end. I hope you are not thinking you can transfer that one anywhere?

El_Torro

Consolidating your pensions won't give you more money in retirement, it will just make the admin easier.

Are any of these pensions Direct Benefit (aka final salary) pensions? Looks like the General Electric one is. Any DB pensions should be left as they are, when you draw down and if you take lump sums will depend on the scheme rules.

Assuming all the others are DC pensions, you can bring them all together if you want. Worth looking at the one with the lowest charges and funds that you are happy with and go from there.

I don't see anything in your list that makes me think you should speak to a financial advisor. Assuming you even found one who was willing to work with such low figures it would not be money well spent.

LHW99

Taking the numbers, but ignoring the GE, and the "at retirement" figures, you get a total of ~£5340 in current money.

If the GE is DB (defined benefit / final salary) then if you took the maximum, with no lump sum and adding in the state pension, you are looking at ~£20k pa. Would around £20k pa be enough for you to live on?

State pension will increase over those 11 years, and the GE (assumed DB) one may also (depends on whether that £8,386.84 is the current, or projected amount.

Things to consider are:

What is the normal retirement age (NRA) of the GE pension? It could be 60, and some DB types don't give any increase if you draw it out later than NRA.

Does the GE pension increase after retirement, eg CPI, CPI capped at 2.5%, 5%….

Could the £5340 give you enough lump sum, particularly as it is likely to increase over the next 11 years. If not, would you need all the potential £42k, and would the reduce pension + state (~18k pa) be enough?

Transferring all the small DC pensions yourself is easy. Once you choose where to put them together, you ask that company to do the transfers. It may take weeks or even months to finally finish, but that doesn't matter too much over the time you have before retirement.

ali_bear

You don't need a financial adviser but talking to some of the free advice available may be of help. Remember that you don't want to start taking any pension income if it will effect your PIP or UC claims (it probably would).

You need to look at each plan to work out what it is (DC, DB, ?). As it looks like the GE pension is DB you can't transfer it. You should probably take it at the normal retirement age for that scheme, but check what happens if you don't, and check if taking it would effect your PIP or UC as above.

For the DC funds it would probably make sense to consolidate them into one place, if only for ease of use. You are free to take income from those at any age over 55/57 but again see above.

Albermarle

Maybe stating the obvious but the GE pension ( which seems to be a DB pension.

Defined benefit pensions | MoneyHelper) is way more valuable than all the other ones put together ( not counting the state pension).

A guaranteed income for life of over £8K pa is a very valuable thing to have, whilst the £2500 you have in the other pension is very small in pension terms.

Although you did not add that much to the GE pension, the employer will have been pouring money into their pension scheme. It is what huge private sector employers used to do in the past.

mystic_bertie

https://forums.moneysavingexpert.com/discussion/comment/81948047#Comment_81948047

Many thanks for your reply, it is much appreciated. Pension Wise did discuss the different schemes with me but their advice was quite basic.

I believe the General Electric is a DC pension. When i was working there they gave everyone £1000 for changing the pension type. Everyone knew at the time, they knew what they were doing, we could not do anything about this.

The other pensions are probably DC but i cannot find any proof of that using my online accounts.

I understand i cant transfer the state pension anywhere.

mystic_bertie

https://forums.moneysavingexpert.com/discussion/comment/81948055#Comment_81948055

Thanks for your reply, much appreciated. I may as well consolodate them all into one. I thought some pensions may grow more than others, if i did consolidate them.

I believe the General Electric is a DC pension. When i was working there they gave everyone £1000 for changing the pension type. Everyone knew at the time, they knew what they were doing, we could not do anything about this.

The other pensions are probably DC but i cannot find any proof of that using my online accounts.

It was Pension Wise that suggested that i talk to a financial advisor. I agree its not worth it when the amounts are so low.

mystic_bertie

https://forums.moneysavingexpert.com/discussion/comment/81948142#Comment_81948142

Many thanks for your reply it is much appreciated.

I believe the General Electric is a DC pension. When i was working there they gave everyone £1000 for changing the pension type. Everyone knew at the time, they knew what they were doing, we could not do anything about this.The other pensions are probably DC but i cannot find any proof of that using my online accounts.

The £8386.84 is the projected figure i got, retiring at 67. At the moment i plan to just retire when im 67. I don't know if the pension does increase annually o think i should ask them this.

Im not sure if the amount is enough or not, im not working and im not in a position to do anything about it. I might return to work but im not sure how likely that is. Im a private renter and so i worry that a big chunk of my money will still be going on rent.

I may as well transfer them all into the GE pension. I thought some pensions might perform better than other, that would be the one to transfer them all to.

xylophone

I believe the General Electric is a DC pension.

Are you sure? You say that the scheme was "changed". What happened to benefits accrued before the "change"?

Who administers this pension?

DRS1

There are some articles online about GE closing its DB pension schemes in the UK in 2021 or 2022. Those articles refer to members going to an existing DC scheme. So it is possible that the OP belonged to that existing DC scheme from the start of employment. Depends how old the DC scheme is.

OP if you are in a DC scheme you should be able to see a current value for your "pot". You should also have information about what the pot is invested in and maybe a choice to invest it in something else. Those are not things you would see for a DB scheme.

One other thing, I suspect the GE scheme may not accept a transfer in from your other pensions as you are no longer a current employee of GE. I could be wrong but you should check that.