Different UK Pension schemes
There are many different types of UK Pension schemes in existence today. While the aim of each is to provide you with an income in retirement, they work in different ways.
Finding out what type of pension you have
Firstly, if you're a member of a pension scheme (or have been a member of a pension scheme in the past), it’s important to check
- which type of scheme you belong to;
- your obligations (and those of your employer, if applicable);
- the benefits that the scheme may provide; and
- when you may be eligible to receive them.
Some pension schemes are provided by employers, these are often called workplace pensions or workplace pension schemes. Other pension schemes can be taken out by you, or you and your employer together. It’s even possible for someone else to set up a pension scheme for you. For example, a parent can now set up a pension scheme for a child. While some schemes will need you to pay in, others may be paid for just by your employer.
The below items look at different circumstances and how this might affect you and your pension benefits.
If you've been a member of multiple pension schemes
If you've had more than one job in your working life, you've probably been a member of more than one pension scheme and each one may provide you with benefits when you retire. When you change jobs, you don’t usually lose your pension benefits. And when you joined each scheme, you should have been given a pack outlining the details of the scheme. You should also have received an annual statement, or Illustration of Retirement Benefits, from the pension provider.
However, sometimes people forget to let update their personal details with pension schemes. If you haven’t been receiving communications, this could be because they don't have your correct contact details. So make sure you check that each scheme knows how to contact you, especially if you have moved house since you joined.
If you do have multiple pension pots, you may want to investigate whether it’s possible, and worthwhile, to combine them. Combining your pension pots can help you keep track of each one and, when you start to receive benefits, make your life easier as you could then receive payments from a single source rather than several smaller payments from different sources. There are a lot of factors to consider when transferring pensions to find out more please see our dedicated pages here.
If you've been a member of a pension scheme before, but can't locate your pension
Sometimes people don't stay with the same employer for very long. If you were only a member of the pension scheme for a short time, you may have been offered a refund of the contributions you made to the scheme.
It's also possible that the scheme you belonged to may have moved, or changed its name – if you have 'lost' track of your pension details, the Pensions Tracing Service can help you to find the current contact details. This is a free service and more details are available here.
If you have changed jobs, it’s likely that you may have been offered the opportunity to transfer your old pension to your new employer’s scheme or to a ‘private’ pension. If you transfer, the new scheme is responsible for providing your benefits on behalf of both schemes.
If you're employed, but not a member of your employer's pension scheme
If you're currently employed, but you aren't currently a member of your employer’s pension scheme, you may find that you will become a member under a new initiative that is being rolled out called automatic enrolment. The intiative has been developed by the Government. To find out what it is and how it will affect you, please click here.
If you've worked abroad
Where can I find out more?
If you need more information, please contact us. A pension specialist from our team will be happy to help with whatever pensions-related question you have. Our help is always free.