Should you combine your pensions?If you have worked for multiple employers, you likely have several pension pots scattered across different providers. Combining them into one can simplify management, reduce fees, and give you a clearer picture of your retirement savings. However, it is not always the right move — defined benefit (final salary) pensions and pots with valuable guarantees should usually be left alone. Never transfer a defined benefit (final salary) pension without regulated financial advice. The guaranteed income these schemes provide is almost always more valuable than the transfer value offered. Step-by-step: how to combine pensions
When should you NOT consolidate?
How much does pension consolidation cost?Most modern SIPP providers charge no fee to receive a transfer in. Your current provider may charge a transfer-out fee — typically £25 to £50 per fund or a flat £100 to £200. Check transfer-out charges before initiating. For in-specie transfers (moving investments without selling), the process takes longer but avoids time out of market. Best providers for pension consolidation
How to find lost pension potsThe government Pension Tracing Service is free and searches the database of UK pension schemes. You need the name of the employer or pension scheme, not your NI number. The average lost pension is worth around £13,000 (PensionBee, 2024) — worth tracing. Verdict Consolidate defined contribution pots — leave defined benefit alone For most people with multiple small DC pension pots, consolidation reduces fees and simplifies planning. The golden rule: never transfer a defined benefit pension without FCA-regulated advice, no matter how attractive the transfer value looks. Frequently asked questionsHow long does a pension transfer take? Defined contribution pension transfers typically take 4 to 8 weeks. Transfers from older or more complex schemes can take up to 12 weeks. Your new provider should give you a timeline when you initiate the transfer. Will I lose money transferring a pension? You could if markets fall during the period your pot is out of the market during transfer. In-specie transfers avoid this but are slower. For most DC pots, the long-term fee saving from consolidation outweighs short-term transfer timing risk. Do I need to tell HMRC when I combine pensions? No. Pension transfers between registered UK pension schemes do not need to be reported to HMRC as long as they are legitimate pension-to-pension transfers. Your new provider handles the regulatory requirements. Can I combine a workplace pension with a personal pension? Yes. If you have left an employer, you can usually transfer your old workplace pension into a personal SIPP. You cannot transfer a pension while you are still an active member of a scheme. |
How to Combine Pensions UK: Step-by-Step Guide 2026
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