Tracking down 3.3 million pension pots
As an industry we talk at length about the importance of engagement, of the opportunity to consider how pensions support aspirations in later life.
Scottish Widows encourages its members to consider their options and take actions to try to improve their retirement outcomes.
Having the right information is a huge enabler. Experience in this market tells us one of the biggest challenges its members face is locating their historic pensions.
The chance of finding a pension policy number from 20 years ago can be slim, and that in turn is a barrier to understanding options to maximise its outcome.
The issue is a big one. The Pension Policy Institute estimates that around 3.3 million pension pots are currently “lost”. It works out to be a staggering average of £9,470 per pot, according to Pension Policy Institute research from 2024, which could make a huge difference to someone who has likely worked very hard to achieve that.
Scottish Widows is partnering with The Pensions Lab to help its members trace their pensions. The service is simple, free to use, and available in the company’s app. Once found, it sets out what the options are, whether that’s considering consolidation or just having the comfort of knowing exactly how much they’ve got in their pensions and what they might want to think about next.
The multi-job millennials
Pension tracing is also important for those who have had multiple jobs in their career. People in the UK have an average of six roles in their lifetime – with this increasing for Millennials to up to 12, according to Moneynet.
Younger people typically move roles more often, with research showing 30% of those aged 18-34 have already had three or more jobs and multiple pension pots, which puts this population at real risk of losing track.
Between name and address changes, working abroad, company mergers – it’s easy to see how pensions get lost. Research from Raindrop last year reported that only 17% of this age group know exactly where all their pension pots are. And as Scottish Widows’ recent Retirement Report (2024) shows, almost half of savers age 22-29 aren’t even on track for a minimum retirement lifestyle.
Younger people’s engagement in pensions is often lower, which is why Scottish Widows has created tools, gamification and educational content to boost this.
Through its app, Scottish Widows members will be able to trace lost pension pots from this summer, view personalised next steps and take actions. They can choose whether to consolidate their pensions into one plan if that’s right for them and they’re not giving up any special guarantees, or connect all their pensions to give them a single view. It takes minutes, is easy, and entirely digital.
What this means for young people
We get it, pensions are not "sexy" for young people. But we, like everyone, can’t afford not to engage with their pension.
The average value of UK lost pension pots is £9,470. If someone said you could find thousands of pounds and make a real difference towards your retirement with just a few clicks, wouldn’t we all?
Supplied by REBA Associate Member, Scottish Widows
Scottish Widows is a life, pensions and investment company.
