Retirement: British warned they are ‘sleepwalking’ towards retirement – act now | Personal Finances | Finance
Retirement savings are often spread over decades, and people are likely to accumulate a number of prize pools over the course of their lives. However, as circumstances change and life progresses, it is easy to lose sight of the arrangements, especially the older ones. But Britons are urged to seek out these funds to make sure they don’t run out later in life.
As such, she wanted to create a simple solution to allow people to have more control over their retirement savings and to feel empowered.
For those who are thinking about consolidation, regardless of which method they choose to do it, there are a number of potential benefits.
These could significantly help people move towards the retirement goal, and are therefore noteworthy.
Ms. Savova continued, “The benefits of consolidation are actually many.
“First, consolidation gives you a lot of peace of mind because most people are anxious about retirement and don’t know much about their savings.
“The second benefit is that knowing how much you’ve saved in total and having a balance in one place can encourage you to save more for the future.
“Otherwise, you can end up sleepwalking throughout your working life and until you retire and only catching the problem too late.
“One of the main benefits of retiring is that if you start early you get what you pay for and your retirement has a lot of time to grow. “
Another important question to consider in this regard concerns some of the costs and charges that are often associated with saving for retirement.
These can vary depending on the pension plan a person is in, however, consolidation can help matters considerably.
Ms Savova added: “Newer style pensions are usually capped by the 0.75% automatic enrollment fee cap, but they don’t always work well.
“Some pensions, especially when they’re small, can be billed entirely at zero, which is something we’ve campaigned a lot against because they can eat into a smaller pension and erode growth.
“For older pension plans, it’s not uncommon to see fees of one to three percent and more.
“Having all of your pensions in one place can help you consolidate them all into one fee tier, and most providers have pricing structures to reduce over time and as your pension grows. “
A final reason mentioned by Ms. Savova for considering pension consolidation concerns the fact that individuals take more control and have more choices over their investments.
As pensions are often invested in a wide range of businesses, which can be both UK and overseas, there may be some interest from a retirement saver.
Many people, Ms. Savova concluded, have strong opinions about the companies their pensions are invested in and may not wish to invest in a company whose ethics do not match their own.
As such, some people choose to go with fossil-free options for retirement investments.
Those who wish to consolidate their pension funds can do so, with transfers being made in a single plan.
However, it can be a complicated business and Brits may need help.
Fortunately, this is available through financial advisers, apps like PensionBee, and helpful guides like those offered by the Pension Advisory Service.