The average unclaimed pension pot is worth £13,000
Pension pots worth nearly £20 billion have gone unclaimed because people are moving home and not telling their provider.
Research from the Association of British Insurers (ABI) shows that around 1.6 million pension pots worth an estimated £19.4 billion have been lost – the equivalent to £13,000 for each pot.
The ABI says people are losing track of their pensions because they rarely contact their pension provider when they move house.
Its survey of over 2,000 savers revealed that when people move home telling their bank or utility provider is the highest priority on their list.
It also found nine out of 10 people automatically think about telling their GP or dentist about their change of address.
However, only one in 25 instinctively think about telling their pensions provider when they move.
The average person has 11 different jobs over their lifetime and moves home eight times, which means it is easy to lose track of your pension if you are not careful.
The Government predicts that there could be as many as 50 million dormant and lost pensions by 2050.
The ABI says insurers are trying to reunite people with their lost pensions, life insurance and investments. This is usually done by sending a letter to their new address.
Yvonne Braun, director of policy, long-term savings and protection at the ABI, says: “During the lockdown many of us have been focussing on those jobs that never get done, so now is the perfect opportunity to check all your financial information is up to date with the correct address.
“Long-term savings providers will continue to work hard to reunite people with their lost money. People deserve all the cash they are entitled to. To ensure more people than ever are reconnected we will continue to work with Government to explore ways data can be used to verify customer addresses.”
How to track your pensions down
When planning for retirement you need to know how much income you will be receiving from all of your pensions.
For people who lose track of their pensions the Government provides a free online pensions tracing service which can help you find any lost workplace pensions.
All you need is the name of an employer or a pension provider to use the service.
The service will not tell you whether you have a pension, or what its value is.
Alternatively, you can contact the Pension Tracing Service by post.
When you have tracked down all your funds you can then consider combining your pensions into a single plan to make them easier to manage and to reduce fees.
This article was originally published in our sister magazine Moneywise, which ceased publication in August 2020.
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