There is over £25 billion in unclaimed pensions in the UK, is any of that yours?
Losing your pension pot may sound like a hard thing to do but according to The Pension Policy Institute, it’s a lot easier than you think. As of 2022, there were over 2.8 million pension pots that were unclaimed or “lost” valued at a whopping £26.6 billion. What’s even more interesting is that according to new analysis by the Centre for Economics and Business Research and PensionBee, the number of lost pension pots could be closer to 4.8 million, with a potential £50.85 billion at risk of being “misplaced.” How do you misplace £50 billion? And can’t they track the people who it belongs to? Apparently it isn’t that simple due to the highly fragmented nature of the UK pension system which is one of the key points discussed by the labor party in their “Big Bang” UK Pension Reforms.
According to a survey conducted on close to 2000 adults in the UK, over 9% of the lost pension pots are valued at £10,000 or more. With the total amount of pension pots in the UK set to rise by 130% by 2050, this is a serious problem. So what can you do about it? The first thing to do is figure out if any of those lost pots are yours. This could mean going through your employment history, looking at past employers and payslips and even using some tools that the UK government has provided to help you find your lost pensions. These tools include the free Pension Tracing Service which scans the database of over 200,000 workplaces to find the person you need to contact. It cannot, however, tell you if you have a lost pension or what it’s worth, that part is up to you.
Becky O’Connor, director of public affairs at PensionBee, was quoted stating “Employers should encourage their employees to hold on to the paperwork from their previous and current workplace pension providers as it contains all the vital information they need, from the provider’s name to the policy number and any additional benefit they may receive upon retirement.” She then goes on to explain how job hopping adds to this problem since people who work in an organization for a short time and then move on to the next don’t tend to hang on to the paperwork. Since most organizations frown at these short tenures, many people don’t even add it to their resume and then it’s lost completely. If you’ve lived and worked in the UK, even for a short period of time, chances are you have a pension pot that’s considered lost right now. The good news is that these lost pots aren’t lost forever and can be claimed with a little bit of homework.
QROPS FAQs
Under what circumstances can I transfer my pension fund from the UK to India?
If you’ve lived and worked in the UK, have accumulated a pension there, and have since moved, or are planning to move back to India, you are eligible.
Does it cost anything to transfer my pension fund from the UK to India?
Not only is the transfer of pension funds to approved pension schemes in India tax-free, but you also nullify any loss that would potentially be incurred due to currency exchange rates, taxes, and similar complications.
How long does it take?
While a number of websites claim it can take up to 6 months, the team of financial advisors at QROPSdirect.in can get the job done in 30 days!