Retirement planning is about to get easier thanks to a clever new online platform
What’s the likelihood of you staying in your current job from now until the day you retire? Unless you’re close to retiring, it’s probably fairly low. The average person changes jobs 11 times during their career, and people starting their careers now will probably move around more. Usually, starting a new job means starting a new workplace pension. As your stack of old pension pots piles up, it can be tricky to keep track. The Department for Work and Pensions estimates that there will be over 50 million lost pension pots by 2050 – that’s a lot of unclaimed money.
Introducing the Pensions Dashboard
To try and solve the problem of stray pensions, the government Pensions Dashboard. It’s being managed by the Association of British Insurers (ABI), with the support of pension providers. The first prototype will be ready in March 2017 and it will launch in 2019, with all UK pension providers encouraged to take part.
The Pensions Dashboard should let you see your pensions in one place for the first time, making it easier to calculate the total value of your pension pots. There will be a state pension calculator to forecast how much you’ll be entitled to once you retire. The dashboard will also give you information about any pension pots you’d forgotten about, including how to access them, a feature which could help to release £400 million worth of long-lost savings.
The Pensions Dashboard is a promising sign that pension providers will soon join the rest of the finance world in using technology to make it easier and faster for customers to control their money. Simon Kirby, the new Economic Secretary to the Treasury, commented: “Technology, like mobile phone apps, has made day-to-day banking easier than it’s ever been and it is time for pensions to catch up.”
Tracking down lost pensions
If you’ve got previous workplace pensions missing, you don’t have to wait for the launch of the Pensions Dashboard to track them down. Your first port of call should be to dig out any old statements and contact your previous employers. The government provides a free online service to help you find contact details for any lost pensions. You can either search by previous employer names or by pension provider (in some cases, your pension provider might have changed name – this service will help you find the new name).
Planning for retirement
The Pensions Dashboard should make it simple to see exactly how much you’ve got and whether you’re on track to retire comfortably. Until it launches in 2019, you can check your state pension entitlement using the state pension calculator. You should also receive annual statements from any pension schemes you’ve ever paid into.
If you don’t, you can contact the provider directly to request a statement. If it’s a workplace pension from a previous job and you don’t know the provider, contact your previous employer to ask for the details. When you get in touch with the pension provider, it’s useful to have the following to hand: date of birth, National Insurance number, pension plan number and the date it was set up.
As with all investing, your capital is at risk. The value of your portfolio with Nutmeg can go down as well as up and you may get back less than you invest. Pension rules apply and tax rules may change in future. If you need help with p