In today’s society, people move jobs much more often than they used to. Gone are the days when you would take a job for life.
As a result, many people have old pension schemes they may even have forgotten about. Those who are a little savvy may consider transferring their old pension schemes into their new one to make sure they don’t forget and they have all their pension in the one scheme.
However, before you do that, remember to consider the following:
Depending on the age of the pension scheme, many older schemes came with guaranteed annuity rates, otherwise known as a GAR. These were quite common in pension schemes written from the 1960’s to the 1980’s. Those old guaranteed annuity rates are often more generous than the newer schemes are so check it out carefully before you do anything. The open market option means that you can shop around to buy an annuity when you retire, but it isn’t worth losing out on a potentially more valuable guaranteed annuity rate in the meantime.
However, also consider how large the pension find is that is in that scheme and the fund charges. Older pension schemes also had higher charges and if the charges are eroding your fund then it might still be worth switching. If you are unsure, take specialist financial advice.
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