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I have a pension with a previous company, and a pension with the company I am working for now.

The two pensions are very similar as far as I can tell. How should I decide whether to leave the old fund where it is or move it into my current pension fund?

I'm UK based.

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  • What are the annual management fees on the two? Those can make a big difference
    – Gagravarr
    Oct 16 '14 at 22:20
  • I have to pay for these things?! Thank you, I'll look into it.
    – conradj
    Oct 17 '14 at 7:06
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It's complicated, and if the sums involved are significant you should seek (and pay for) professional financial advice. I am not a financial adviser, and therefore this is not financial advice.

If the previous pension is a defined-benefit (final salary) pension then you're very unlikely to be able to transfer it into a new scheme and get the same benefits -- you'll only get a lump-sum transfer that can be used for a defined-contribution scheme, and the lump sum is unlikely to be large enough to get the same benefits. So leave it where it is.

If it's a defined-contribution (money purchase) scheme, then it really depends on how much they'll charge you for the transfer, and how much the old and new pension providers charge in management fees. Read the small print for both schemes. It's also possible that the two schemes don't offer the same range of funds to invest in, and you should make sure that the new scheme offers a suitable fund for you.

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The first stage is to contact both providers to work out what charges each will make for the changes.

I undertook this process in the UK in 2018. Neither provider in that instance charged me for making the transfer.

The process itself was driven from the destination provider, they requested the transfer of monies which my source provider then asked me to authorise.

This was a very lengthy process. Checking my email correspondence I first provided a Transfer-in form to the destination provider in May, and the transfer completed on the 28th of November. Including around two weeks were the funds showed in neither of my pension accounts.

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