Like many professionals, the new 'standard' length of stay at any one company is around 2-3 years.

I myself have moved a few times at the start of my career from one company to another, beginning new company workplace pension pots.

I've since remained at my current post happily for a number of years now, built up a good pension with my current workplace, however I've left a trail of small pension pots at the previous job roles.

Would it be beneficial to keep these smaller pots with their respected schemes, or should I decide to track these down and attempt to 'refund' them?

I question this because, I know that after only 2-3 years of accumulation, the pots will be negligible, however this capital could be used better elsewhere if I was to withdraw them.

I understand this might be quite general question but, I have a small doubt that in 40 years time, I'd remember to claw back these small pots once I do hit my retirement.

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    Are any of the pots "defined benefit" i.e. based on years you worked there / salary you were paid? Or are they "defined contribution" i.e. you/the employer each paid in a certain % of your salary? You mention "accumulation" so I would suppose the latter, but this is important info on which to base the answer. – marktristan Apr 27 '16 at 10:06
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    Also could you clarify what you mean by 'refund' them / 'withdraw' them? Do you mean to consolidate them all in one pension that you continue to invest for your retirement, or do you mean to get the funds out as cash? – marktristan Apr 27 '16 at 10:08
  • @marktristan Morning marktristan! Indeed the latter for the first comment; as this is probably the most common form of pension for most salary jobs [at graduate level too I must add!]. – MackieeE Apr 28 '16 at 8:32

the pots will be negligible, however this capital could be used better elsewhere if I was to withdraw them.

You won't be able to withdraw the money. Notwithstanding the recent 'pension freedom' changes, money put into a pension is still inaccessible until age 55 at the very earliest, and probably later by the time you get there. You should have been Advised of this every time you enrolled into a scheme, although it may well have been buried in something you were given to read.

The best you can do (and what I would recommend, although of course this post isn't Advice) is to transfer the pensions to a personal pension, for example a SIPP, wherein you will be able to control where the money is invested. Most SIPP providers will gladly help you with such transfers.

Would it be beneficial to keep these smaller pots with their respected schemes

The reason I suggest transferring is that leaving the funds in workplace schemes that are no longer being contributed to is a surefire way of finding yourself invested in poorly-performing neglected funds, earning money for no one beyond the scheme provider.

  • Fully agree with this; I consolidated several defined contribution schemes I'd picked up with various employers in a SIPP... much, much simpler that way, and actually very easy to do. – timday May 3 '16 at 0:57

I'm assuming that all the savings are of 'defined contribution' type, and not 'defined benefit' as per marktristan's comment to the original question.

Aside from convenience of having all the pension money in one place, which may or may not be something you care about, there may be a benefit associated with being able to rebalance your portfolio when you need do.

Say you invest your pension pot in a 60%/40% of equities and bonds respectively. Due higher risk/reward ratio of the equities part, in the long run equities tend to get 'overweight' turning your mix into 70%/30% or even 80%/20%, therefore raising your overall exposure to equities. General practice is to rebalance your portfolio every now and then, in this case, by selling some equities and buying more bonds ("sell high, buy low"). Now if you have few small pockets of pension money, it makes it harder to keep track of the overall asset allocation and actually do the rebalancing as you cannot see and trade everything from one place.


Your last sentence is key. If you have multiple accounts, it's too easy to lose track over the years. I've seen too many people pass on and the spouse has a tough time tracking the accounts, often finding a prior spouse listed as beneficiary.

In this case, your gut is right, simpler is better.

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