Is Merging multiple pension scheme pots a good idea?

Question

Since I moved to the UK I changed jobs three times and my employers used different pension schemes. I would like to move the money into one scheme.

Do you think it is a good idea?

The last scheme is Nest, do you suggest moving money into it?

Answer 1

Different schemes can have different rules. For instance some schemes used to allow taking a pension at 50 rather than 55 and if you joined such a scheme then your rights to do that still exist. If you transferred from such a scheme you'd lose that right and be unable to take that pension till you were 55. Other rules may also differ.

You or your financial adviser needs to compare the terms and conditions of all schemes and determine whether there are any benefits you'd lose that you care about. Clearly if you're 55 or over now then you don't care about being able to take your pension at 50 for instance.

You need to be even more careful if any of those schemes are final salary schemes (defined benefit) rather than money purchase (defined contribution) because the terms and conditions are so different.

The main reason to have a single pot is that it's administratively easier, you have only one company you need to contact regarding when and how much money to take from your pension.

Beyond that we can't offer individual advice but you could find a qualified professional who can if you think you need such advice. You will have to pay for that advice though.