Roy from London

I’m a 50 year-old council worker who has had a variety of different jobs (and pensions) in the public and private sector. I reckon I’ve got about £140,000 in pension savings altogether. 

Are there any benefits to me combining these in one place? Or will the pension dashboard do this for me? And what is the best way to maximise my benefits in retirement?

The pension dashboard project is designed to allow people to see all of their retirement pots in one place online.

A limited version is expected to be up and running in 2019, although it’s worth noting the introduction will be phased, meaning you will unlikely be able to see everything – including old defined benefit (DB) pensions – in the first version.

In fact the pensions minister says it could take ‘three or four years’ for pension dashboards to be fully live.

Dashboards won’t allow you to transact or cut your charges, however. If you want to combine your defined contribution (DC) pensions in one place you’ll need to take action yourself.

Doing this can make sense for a number of reasons.

Overpaying in charges can have a devastating impact on the value of your fund over the long-term, so if you can get all your pots with a single, good value provider that meets your needs you’ll have made a decent start.

It will also make it much easier for you to keep track of the performance of your portfolio. While you should avoid over-trading (as this costs money and eats into your returns), it’s good to keep on top of your investments and review regularly – at least once a year.

DB pensions are trickier to combine because they are a promise to pay an income through retirement rather than an individual pot of money. You should speak to each scheme to find out how much income they will provide and from what age – it might be more valuable than you think.

As you work in the public sector the best way to maximise your retirement benefits is likely to involve staying in your DB scheme.

If you have any extra spare cash it might be worth paying into a personal pension scheme such as a SIPP, where you benefit from tax relief on the money you pay in and 25% of withdrawals from age 55 are tax-free. This would also potentially be a good place to consolidate your DC pensions.

This can be a complex process, so consider speaking to a regulated financial adviser who can give impartial advice based on your personal circumstances.

Do you have a question on retirement issues?

Send an email to editorial@sharesmagazine.co.uk with the words ‘Retirement question’ in the subject line. We’ll do our best to respond in a future edition of Shares.

Please note, we only provide guidance and we do not provide financial advice. If you’re unsure please consult a suitably qualified financial adviser. We cannot comment on individual investment portfolios.

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