How to Combine Pensions

How to Combine Pensions

As we change jobs over our lifetime, it’s common to accumulate multiple pension pots. These may be workplace pensions from previous employers or personal pensions you’ve opened yourself. While having several pensions isn’t unusual, it can be confusing, time-consuming to manage, and even costly.

That’s where combining pensions—also known as pension consolidation—can help. It allows you to bring some or all of your pension pots together into a single scheme, making it easier to keep track of your retirement savings and potentially reduce fees.

But it’s not always the right move for everyone. This guide explains when and how to combine pensions, the pros and cons, and how to avoid common mistakes.

What does it mean to combine pensions?

Combining pensions means transferring one or more existing pension pots into a single scheme. You can do this by:

• Moving old workplace pensions into a current workplace scheme

• Transferring pensions into a personal pension or a SIPP (Self-Invested Personal Pension)

• Using a pension consolidation service, such as PensionBee, Moneyfarm, or a financial adviser

The aim is to simplify your finances, improve control, reduce paperwork, and potentially lower investment charges.

Who can combine pensions?

Most people with defined contribution pensions (e.g. standard workplace pensions, personal pensions, SIPPs) can consolidate their pots.

You may want to consider combining pensions if you:

• Have lost track of old pension pots

• Are paying high fees with your current provider(s)

• Want to manage everything in one place

• Are approaching retirement and want a clearer picture of your total savings

• Want more investment choice or control over your pension

However, defined benefit pensions (final salary schemes) need special consideration — and you usually cannot combine them into standard personal pensions without taking regulated financial advice.

How to combine pensions: Step-by-step

1. Track down your existing pensions

Start by listing all your pensions, including:

• Workplace pensions from past jobs

• Personal pensions or SIPPs

• Frozen or preserved pensions you’re no longer paying into

If you’re missing details, use the Pension Tracing Service to locate old schemes.

2. Request up-to-date pension statements

Contact each provider and ask for:

• Current fund value

• Annual charges

• Investment performance

• Scheme benefits and transfer value

• Any exit fees or penalties

• Details on whether it’s a defined contribution or defined benefit pension

This will help you compare and make an informed decision.

3. Check for guarantees and benefits

Some pensions come with valuable features, such as:

• Guaranteed annuity rates

• Protected tax-free lump sums

• Life cover or spouse benefits

Transferring could mean losing these, so it’s vital to read the small print or speak to an adviser if unsure.

4. Compare charges and performance

Older pensions sometimes have high fees and limited investment choices. Newer providers may offer lower annual charges (e.g. 0.3–0.8%) and more flexibility. Look at:

• Annual management charges (AMC)

• Fund performance over 5–10 years

• Platform fees or transaction costs

Consolidating into a low-cost, well-performing plan could significantly boost your pot over time.

5. Choose a new pension provider (if needed)

If you don’t already have a preferred scheme, you can:

• Use your current workplace pension (if it accepts transfers)

• Open a personal pension or SIPP with a trusted provider

• Use a digital provider like PensionBee, which manages the transfer process for you

Make sure your chosen scheme is FCA-regulated, reputable, and offers transparent fees.

6. Request the transfer

You’ll need to:

• Complete transfer forms with your new provider

• Provide policy numbers and scheme details

• Authorise the transfer (online or by post)

Transfers typically take 2–8 weeks, and some providers may charge exit fees — so check before proceeding.

Pros of combining pensions

Simplified management – Fewer accounts, less paperwork
Clearer picture of your retirement pot
Potential to reduce charges and improve growth
More control over investments or retirement income options
Easier to manage retirement withdrawals from a single source

Cons and cautions

Loss of benefits – Guaranteed annuity rates or protected tax-free lump sums could be lost
Transfer charges or penalties may apply
Poor transfer timing – Markets may drop during transfer
Not suitable for defined benefit pensions without specialist advice

If you’re transferring a pot over £30,000 with guarantees (e.g. defined benefit pensions), you’re legally required to take regulated financial advice.

When not to combine pensions

You may want to keep pensions separate if:

• You have a final salary or career average pension, offering guaranteed income for life

• Your pension includes a protected early access age (e.g. 50 instead of 55)

• Your current scheme has very low charges or exclusive investment funds

• You’re planning to access different pots at different times (e.g. phased retirement)

In these cases, consolidation could do more harm than good.

Can you combine pensions after you retire?

Yes — if you’ve not accessed the pot or have only taken your 25% tax-free cash, you may still be able to transfer. But once you’ve fully entered drawdown, some schemes no longer allow transfers.

Combining pensions after retirement should be handled carefully, as drawdown and tax rules can become complex.

Final thoughts

Combining pensions can simplify your retirement savings, reduce fees and help you make smarter investment decisions — but it’s not a one-size-fits-all solution. It’s important to:

• Review each pension carefully

• Check for benefits you might lose

• Compare charges and performance

• Seek regulated financial advice if you’re unsure

Even if you choose not to consolidate, reviewing your pensions regularly ensures you stay on top of your retirement income plan.