Should I put all my pensions together?

Combining multiple pension pots into one is called pension consolidation. Whether it makes sense depends on a number of factors, and there is no single right answer for everyone.

Potential benefits of consolidating include easier management (one pot, one set of statements), potentially lower overall charges, and a clearer picture of your retirement income. If you have several small pots from old jobs, they can be easy to lose track of over time.

However, there are important things to check before transferring any pension. Some older pensions include valuable guarantees — such as a guaranteed annuity rate (a promise to convert your pot into income at a fixed, often favourable rate) — that would be lost if you transferred out. Some workplace pensions also have lower charges than personal pensions, so consolidating could actually cost you more.

Defined benefit pensions (also called final salary schemes, which pay a set income in retirement based on your salary and length of service) are treated very differently from defined contribution pensions (where your pot depends on contributions and investment growth). Transferring out of a defined benefit scheme carries specific risks and regulatory requirements.

Tax-free cash entitlements, death benefits, and the type of investments available in each scheme are also worth examining before any transfer.

Because the right answer depends on the details of each individual pension you hold, it is worth speaking to a regulated financial adviser who can review your specific circumstances before making any decisions.