Pension Consolidation: A Beginner's Guide 🔄
If you've had more than one job, chances are you've got more than one pension pot floating around. And let’s be honest – remembering where they all are (or even that they exist!) isn’t easy.
That’s where pension consolidation comes in. It's the simple idea of bringing all your old pensions into one place so they’re easier to track, manage, and grow.
Here’s everything you need to know - the why, the how, and what to watch out for.
What is pension consolidation? 🤔
It’s exactly what it sounds like - combining multiple pension pots into one.
Instead of juggling different logins, providers, and statements, you merge them into a single pension account - often a personal pension or SIPP (Self-Invested Personal Pension). This makes your life easier and gives you a clearer view of your total retirement savings.
Why bother?
Here's a few reasons why pension consolidation is worth thinking about:
✅ Simpler to manage - One pot = less admin, fewer fees, and a clearer picture of where you stand.
🧠 Less chance of forgetting money - Old pensions often get left behind. Combining them means no forgotten pots.
💸 Save on fees - Some older pensions have higher charges. By consolidating into a low-fee provider, more of your money stays invested and working for you.
📈 More control + investment options - Modern pensions (like SIPPs) often offer better investment choices than older schemes.
🧾 Easier retirement planning - Seeing your full pot in one place makes it easier to know if you're on track.
How to consolidate pensions (it’s easier than you think ✨)
Thinking of taking the plunge? Here's a quick step-by-step to get started:
List your pensions - Think back to every job. Got old paperwork? Use the Pension Tracing Service if you’re unsure.
Check for any fees or guarantees - Some pensions have exit fees or valuable perks (like guaranteed annuity rates). If so, weigh up carefully - or get advice.
Pick where to consolidate - You can use an existing pot or open a new one (e.g. a SIPP or modern personal pension). Compare providers for fees, features, and investment options.
👉 This is where Chest can help. We’re building a modern pension app that makes it simple to transfer old pots, see everything clearly in one place, and even earn cashback rewards into your pension. All in a fresh app that actually makes saving easy.
Start the transfer - Once you’ve chosen your 'new home', most providers will do the admin for you. Fill in a transfer form, and they’ll contact your old schemes to move the money over.
Track progress + confirm - Transfers usually take a few weeks. Once complete, your pension will be in one place - much easier to track.
Can I transfer any pension?
Not all pensions can (or should) be transferred. Here’s a quick guide:
✅ Defined Contribution pensions (most modern workplace or personal pensions) - These are the easiest and most common to consolidate.
⚠️ Defined Benefit pensions (final salary schemes) - You can transfer, but it’s a big decision. You’d be giving up guaranteed income, so advice is required if the pot is over £30k.
🚫 State Pension - This one’s from the government and can't be moved or merged with anything else.
Pros & Cons ⚖️
Thinking about whether consolidation is right for you? Here’s a quick look at the upsides and potential downsides:
✅ Pros:
Easier to manage
Possible fee savings
One investment strategy
Better visibility and control
More flexible retirement options
⚠️ Cons:
Could lose valuable guarantees (like annuity rates or DB income)
Some providers charge exit fees
Transfers are usually irreversible
Don’t move an active workplace pension - you’ll lose employer contributions
Fees to look out for 💷
Before you consolidate, make sure you understand any costs involved. Here are the main ones:
Exit fees from your old pension
Platform or fund fees from your new provider
Advice fees (if you're getting help or doing a DB transfer)
Trading delays or missed growth during the transfer window
💡 Some providers offer cashback or incentives for transfers - just make sure the long-term value outweighs the short-term perk.
Tools to make it easier 🔧
You don’t have to do this all on your own. There are some great tools and services that can help:
App-based services (like Chest!) – Easy sign-up and automatic transfer help
Big-name providers (e.g. Aviva, Standard Life) – Often let you transfer other pensions into an existing one
Financial advisers – Great if you've got large or complex pots
Government tools – Use the Pension Tracing Service if you’ve lost track of a pension
Final thoughts 🌱
Combining your pensions is like a financial spring clean - it takes a bit of effort upfront but makes life way easier long term.
Just make sure to check for hidden fees or valuable benefits first - especially with older pensions. If it all looks good, consolidating can mean:
less admin
lower fees
more control
and a clearer view of your retirement future.
And talking of the benefits of consolidating pots - the Chest app is coming later this year! Combine your pensions into an easy-to-use SIPP that you can manage from your phone, use automated tools to seamlessly grow your savings, and get cashback rewards into your pension when you spend with top brands.
Ready to take control of your pension? 👉 Join the waitlist.