Put a smile on your pension pot
When it comes to planning our future, there’s plenty more we should all be doing to make the most of our savings.
We’re now living far longer than previous generations – the average life expectancy1 for women in the UK is 82.9, with male life expectancy not far behind at 79.2. So you would think that the majority of us are putting a lot of thought into how best to feather our future nest by saving for our pension.
Research, however, would suggest otherwise. According to a recent report by the Financial Conduct Authority2 on consumer attitudes and experiences of pension savings, 81% of us haven’t thought about how much we should be paying into a pension. Three-quarters of us, meanwhile, have not considered how we’ll manage financially in retirement, 53% of us haven’t checked the value of our pots in the past year, and 71% of us don’t know the charges we’re currently paying.
Checking pensions regularly can help you make sure that you’re on track for the retirement you want, and that your investment choices are still right for you based on your age and attitude to risk. It could be that you’re being held back by limited investment choice, or paying higher charges than you need to.
So here’s where you need to do a quick check to find out if you’re on top of your finances – if you answer ‘no’ to any of these, it’s probably time to take action.
Questions to ask yourself about your pension?
- Have I reviewed my pensions in the past 12 months?
- Do I know how many pensions I have and which pension provider(s) they are with?
- Do I know how my savings are being invested so they have the potential to grow?
- Do I know how much I’m paying in fees?
- Do I know how much I want to save and whether I’m saving enough?
A key reason you may be finding it difficult to keep track of your retirement savings, is if you’ve built up several pension pots with different employers over the years. That’s why many people find it easier to consolidate their pensions into one place. Not only can it save time and hassle, but you can more easily see how much you have, where your money’s invested and how it’s performing.
Most pensions are portable and in most instances you have the freedom to move them to a provider of your choice. One way to do this is to transfer your pensions into a Self-Invested Personal Pension (SIPP), which offers flexibility and convenience.
With a SIPP you choose what to invest in and when, and can take an income when and how you like after the age of 55. Fidelity’s low cost SIPP, for example, allows you to bring your pensions together into one online account. You can choose to keep the same investment choice as your current provider (re-register) or you can transfer as cash and select new investments to go into your SIPP.
Fidelity gives you plenty of guidance and information along the way, with easy to use investment selection tools and retirement planning calculators to help with various aspects of retirement planning - from how much you need to save, to what might be the right income option for you when it comes to accessing your pension. Fidelity’s call centre is also on hand to offer you guidance and support. Just call 0800 368 1727. Lines are open Monday to Friday 8am to 6pm and Saturdays 9am to 2pm.
- You can choose to pay a lump sum into your SIPP, make regular monthly contributions, or both. Flexibility is a key feature of SIPPs.
- Transferring old workplace pensions into a SIPP can make it easier to manage and keep track of your retirement savings. Please note, if your employer is paying into a current workplace pension, you should leave that pension where it is or you may lose contributions from your employer.
- Keep a diversified range of investments within your SIPP so you are well placed to ride out the inevitable ups and downs of the markets.
- If you’re looking for a simple, straightforward way to invest then you can choose a multi-asset fund. These give you exposure to a range of assets, sectors and geographies, and are a great way to ensure you have a well-diversified spread of assets from the start.
1 Source: Office for National Statistics lifetime tables: 2015-2017, release date 25 Sept 2018
2 Source: The percentage statistics are taken from the FCA Data bulletin, March 2018, on consumer attitudes and experiences of defined contribution pension savings.
See below for important information.
Pensions all over the place? Sounds exhausting
Make life easier and be better prepared for the future by bringing your pensions together. Plus get £20 to £1,000 cashback (exclusions, T&Cs apply)
The value of investments and the income from them can go down as well as up so you may get back less than you invest. Tax treatment depends on individual circumstances and all tax rules may change in future. This information is not a personal recommendation for any particular investment. It’s important to remember that the value of investments can go down as well as up, so you may not get back the amount you originally invest.
You cannot normally access money in a SIPP until age 55. Company shares are not yet available for all Fidelity SIPP holders and are not eligible for the cashback offer within a SIPP. Pension transfers can be complex and pensions with safeguarded benefits and advised transfers are also not eligible for the cashback offer. Please read our pension transfer factsheet, cashback T&Cs and exit fees T&Cs which are available at fidelity.co.uk/cashback.