Many people have lost track of their pension
With the workplace pension adverts taking over our television channels, it’s hard not to think about saving for a pension, even if it won’t be needed for a good few years. But new research has shown that UK adults are thoroughly confused by pensions and are losing track of them due to a shift in working cultures with people changing jobs more frequently.
We asked Amanda Smith, Head of Human Resources at Colemans-Ctts Solicitors, why people weren’t keeping track of their pensions and she said it is because they are not seen as important enough and frequent changes of jobs make it even harder to keep track of them. She blamed the bad reputations pensions have for the problems;
“Pensions are often seen as a Foreign Language, complicated and hard to understand. There has been a lot of bad press about the performance of pensions and, especially in the younger generation, it is seen as dead money.”
“The reality is, that it is only as you grow older that you realise the significance of a pension particularly in modern society where people need to plan for their pension.”
It seems that many people are signing up for a variety of pensions and then losing track of them; 10% of people blame this on the fact that they frequently change jobs, while 20% claim to have lost their pension paperwork.
The research also shows that 47% of all missing pensions are ‘lost in the mists of time’ with people forgetting they even have them. However, one quarter of people are aware of losing track of at least one pension scheme, and yet only 30% of these would actually attempt to trace it again.
This is due to not knowing how or where to start looking for a lost pension. As of yet, there is no central database for pensions for the public to access but Amanda feels that this would be the right way to go to help those who are lost and confused.
She said a searching system “where all pensions were registered centrally and from which members of the public could search against their name to find a list of their pensions would be very helpful indeed.”
The problem of losing pensions is not just an occurrence among those who are reaching retirement age either as 37% of people aged 18-44 have experienced losing track of a pension. But Amanda feels that most people will reject advice;
“Let’s be realistic, anything that impacts pay in the pocket is unlikely to be embraced.” She added, “The reality is, that it is only as you grow older that you realise the significance of a pension particularly in modern society where people need to plan for their pension.”
Her advice for anyone who thinks they have lost track of a pension is to draw up a will with their partner;
“If someone has lost track of their pension and then they pass away, this problem gets much worse, and the spouse of the deceased could also miss out on benefiting from their partner's pension. The best way to avoid this is to draft a will with a solicitor, as this is a good opportunity for you and your partner to review all your finances and recap where you each have a pension.”
Are you completely confused by pensions? Let us know by commenting below or tweeting us @FemaleFirst_UK