28 Dec 2017 Many UK families will enter the New Year with a resolution to sort out their finances and research from OneFamily has revealed that forgotten pension pots may be a good place to start.
Millions of savers admit to losing track of their pensions savings, with just 47% saying they know who their provider is. Savers are also in the dark about how much they have put away with one in three workers (32%) saying they have no idea what they have saved and a further third (37%) saying they only have a vague idea.
To help people get on top of their retirement savings this January, OneFamily has the following advice:
- Contact old employers. If you think you may have had a pension through an old job contact the HR team at the company who should be able to point you in the right direction
- Combine your pots: Sometimes multiple pots can seem like too much to manage – over one in 10 people (13%) has three or more to keep track of – you can combine all your savings into one account to make it easier to keep track of, however you need to check any fees you may need to pay if you are moving money
- Track down lost pots: Get in touch with old providers so you can map out what money you may have sitting with them. The Government provides a handy Pensions Tracing Service to help you find lost pots
- Start young: There are lots of options to help top up your retirement savings. While many people might take advantage of a Lifetime ISA for the money towards a deposit on their first property, they are also a great product for under 40s to start putting extra money away for retirement
- Check just how much you are saving for retirement: While auto-enrolment has seen more people than ever saving into a pension, at present the minimum saving is 2% (of which at least 1% must be paid by your employer). While there are plans to increase this over time to a total of 8%, you may not be putting an adequate amount away to reach your goals for retirement, so check now to avoid problems down the line. Your provider should also send you an annual statement which you can review.
- Talk to a financial adviser. Taking financial advice when you are thinking about how much you need to save for retirement, or when you are getting close to could help you make the most of your pensions savings and inform you about other products that might help both before and during retirement
- Make the most of what you have once you reach retirement: For those nearing retirement, they might feel their existing savings will not enable them to achieve the level of income they need. However, there are other ways to boost the cash you’ll need for retirement. Many people are using equity in their home and releasing it using products like OneFamily’s Lifetime Mortgages to help them achieve their goals.
Simon Markey, OneFamily CEO, commented: “The start of New Year is a great opportunity for savers to get their existing investments in order, plus think about the future and what they might need. Tracking down and keeping on top of existing savings is the first step, but also thinking about what you might need in your later years, and how you plan to fund them, is equally important.
“For those nearing retirement who may find they don’t have as much put away as they hoped, there are a number of alternative ways to fund it. Lifetime mortgages are becoming an increasingly popular option as people take advantage of the value hidden in their homes, and over the last year, the number of people using these has increased by nearly 60% as homeowners take advantage of the house price increases we have seen over the last few years.”