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At any point in your life, you might be interested in finding out the much you have in pension. This information is essential for you because it might help you start managing them more effectively. One of the best ways to do this is by consolidating your pensions, says Mike Coady. But what is pension consolidation?

Pension Consolidation

If you bring all your pension pots and make them into one, then that is called pension consolidation. You might have worked for many employers through your career, therefore letting you come up with quite a number of pension pots, or rather a pension scheme. In some instances, you might have personal pensions, more so if you have spent some time personally employed. Though not a must, at some point, when you are approaching retirement, you might want to consolidate them. But there are benefits you stand to enjoy if you choose to bring your pensions together.

Before you decide whether to consolidate your pension or not, there are several factors you ought to consider. For example, you want to find out the type of retirement pension they are, how well they are managed, and the much they are worth. If there are any unique guarantees attached, this will also impact how you treat your pension pots when you are near retirement.

You Can Combine Your Defined Benefit Pensions

If you currently have a financial salary of defined benefit, you will be given an option to have it transferred into a defined contribution pension, which is the most common type. However, before you make this move, you must think carefully. Talking to a pension expert is essential because with such transfers, trading a lifelong income that is guaranteed is involved. You will be purchasing it with a given amount of money in the form of a pension. Therefore, you should seek legal advice from experienced pension advisers such as Mike Coady before having your final salary pension transferred.

If you feel that transferring your pension is the best thing to do, ask yourself it the transfer value equals the current value. In case you find that its lower, then that might indicate that there are fees involved in the transfer process. At this stage, talk to your advisor to help find out the nature of costs involved and if it is possible to have them removed.

Making the Tough Decision

As already said, it is essential that you work alongside a financial expert. They will thoroughly and carefully peruse your pension paperwork and then liaise with your provider. This process is meant to ensure that you build up a clear image of your existing pension arrangements. Your advisor must ensure that you get a transparent and fair recommendation regarding what you need from your retirement. Note that there is no one-answer-fits-all response when it comes to pension recommendation, and this explains why you must always seek tailored advice. If you like, you can make some top-ups to your pension before retirement through contributions.

How to Make Your Savings Deliver More

Thankfully, there are many things that you can do to ensure that your savings deliver more. One of the most obvious ones is by saving money every time you can. If you have some extra income, then you might want to put it into your pension is one of the best ways of investing it. Note that every time you place an additional income into your retirement, the taxman will always top it up. If you can access a workplace scheme that your employer contributed to, then based on the rules of the program, if you improve your contribution, then your employer might improve theirs too.

The other way of making your savings deliver more is by claiming all your tax relief. All higher rate taxpayers that make pension contributions to a personal pension or a given workplace are accustomed to receiving necessary tax relief on their input. Nevertheless, all higher rate tax will have to be claimed on your self-assessment tax return. It is one tax relief that puts you in a position to acquire even more significant pension contributions.

It is also essential to regularly review how your pension pot has been invested. Those with defined contribution workplace or personal pension have the privilege of choosing how their pensions are invested; most of the time, this entails choosing from an array of funds that are offered by their pension providers. These funds will then be weighed differently between given types of assets that provide different levels of risks as well as potential returns. It is a general rule of thumb that younger individuals stand the chance of taking more risks compared to older ones.

If you have your money invested for a more extended period, you will have more scope to go through ups and downs in terms of asset performance. For example, if you are currently under 50, and have had your pensions savings conservatively invested, you might want to consider transferring some of your funds into higher growth assets like stocks and shares. However, note that higher growth is not guaranteed even if you make such a calculated move. Therefore, before you do anything, make sure to talk to your financial advisor. They can help you determine the best thing to do.


Mike Coady is a financial expert who has been in the market for a very long time. Thankfully, even if you can’t reach him in person, you can check out his website to learn a tip or two on how to invest your savings. Also, pension consolidation is a wise move as long as the right steps are taken. Therefore, before making your mind, it is advisable that you take your time and consider all the factors mentioned above. However, it is vital that you start saving when you still have the time to increase what you get from your savings when you retire. Kindly share this article if you found it helpful. Also, feel free to drop us a comment below.

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As an expat, investment planning is essential and needs to be thought-through with the assistance of an expert.

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Blog published by Mike Coady.


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