- One in six workers admit to losing track of their pension fund when changing jobs –
- Abandoned pension pots set to rise with frequent job switching by younger workers –
- Men’s estimates of total pension savings are three times higher than women’s –
One in six (16 per cent) workers have lost track of their pension funds after changing jobs, according to research from Prudential, raising new fears over a generation of lost pensions.
To compound matters, the survey of employees found that three in four (76 per cent) people have no idea of the value of the company pension pots they have built up over their careers. Just 24 per cent are confident that they know the value of their combined pension funds.
More than four in five (81 per cent) workers failed to actively transfer their previous company pension funds across to their new employers, while another 15 per cent relied on their new employers to make the switch.
Keeping track of pension funds is a significant risk for younger workers, in particular, as they change jobs more frequently than older employees. According to Prudential’s survey, workers aged between 18 and 34 have had, on average, three full-time jobs, compared with those aged 55 and over who have had just five jobs in their careers.
Stan Russell, retirement expert at Prudential, said: “Saving into a pension today is an important step in the right direction for workers, to help ensure a comfortable retirement.
“It is essential for people to understand what type and level of savings they have built up in the past. They must make sure that their previous employers have their most up-to-date personal details and are sending them annual pension statements, so they can keep themselves properly informed.
“Keeping track of pension savings at every age is important but it is even more crucial for younger workers, who are likely to switch jobs more often, to actively manage this process. It’s also important to consider the benefits of transferring previous pension savings into a new employer’s scheme, although seeking advice before making such a big decision is a must. For those who have lost track of their previous company pension pots, the Pensions Tracing Service (www.direct.gov.uk/pensiontracing/) should be able to help.”
Prudential’s research also found that workers who do know the value of their combined pension pots say they have built up an overall fund worth £110,207, on average, over their working lives. However, there is a significant gender gap here as men believe they have built up pension savings totalling £154,094, whereas women estimate they have saved only £50,512.