Nearly 3.3 million pension pots worth over £31 billion have been lost in the UK, according to the Association of British Insurers. For someone aged 55 to 75, the average lost pension is worth £13,620 — enough to cover several years of essential spending in retirement. When you change jobs every few years, each old pot becomes a deferred pension that stays invested in your name. The risk isn’t that the money disappears. It’s that you lose track of it, pay higher fees without noticing, and miss the chance to consolidate it into something you actually manage.
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This article is general information only and does not constitute professional advice. For your specific situation, consult a qualified professional.
Since auto-enrolment launched in 2012, over 10 million UK workers have been enrolled into workplace pensions. The average NEST pot sits at roughly £3,800 — a figure that makes sense when you consider how many people have held multiple jobs and left small pots behind. Each time you move, your old employer stops contributing, your payroll deductions end, and the pension becomes a deferred pot. Your new employer will usually enrol you into its own scheme, and the cycle repeats.
What tends to get overlooked is that the old pot doesn’t just sit there quietly. Fees often change, investment choices may be limited, and the longer you leave it without reviewing it, the harder it becomes to track down. Here’s what you actually need to know.
Most workplace pensions today are defined contribution schemes, where your pot depends on what you and your employer paid in and how the investments performed. When you leave a job, that pot becomes a deferred pension — it stays invested, but you and your old employer stop contributing. What you do with it next depends on the fees, the investment options, and whether you want one pot or several.
What I tend to notice is that most people don’t realise the fee structure changes once they leave. That’s the detail that costs the most over time.
The Fees, Contributions, and Age Rules That Change When You Switch Jobs
Three numbers matter most when you leave a job with a workplace pension: the deferred-member fee, the transfer timeline, and the minimum pension age. The fee is the one that quietly compounds.
Many workplace schemes charge active employees a lower annual fee — often within the 0.75% auto-enrolment charge cap — and switch deferred members to a higher tier. That increase of 0.10% to 0.50% may sound small. On a £20,000 pot over 20 years, an extra 0.40% in annual fees costs roughly £2,400 in lost growth. On a £50,000 pot, it’s closer to £6,000.
The table below compares the three main options for an old workplace pension. Each has different trade-offs for fees, control, and admin effort.
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| Option | Typical annual fee | Investment choice | Admin effort | Best for |
|---|---|---|---|---|
| Leave it in the old scheme | 0.45%–0.75% (deferred tier) | 10–30 funds (default fund) | Low — but multiple pots to track | Low fees, good fund, or guaranteed benefits |
| Transfer to new workplace pension | 0.30%–0.75% (active tier) | 10–30 funds (default fund) | Medium — one transfer form, 4–12 weeks | Consolidation with lower active fees |
| Transfer to a SIPP | 0.15%–0.45% (platform fee) | Thousands of funds, ETFs, shares | Medium — you manage investments | Lower fees, wider choice, full control |
The transfer process typically takes 4 to 12 weeks. You’ll need the old provider’s name, policy number, and latest statement. Your new provider handles most of the paperwork once you fill in a transfer form. The government’s Pension Tracing Service is free and can help you locate old schemes if you’ve lost the details.
Minimum pension age is currently 55, rising to 57 in 2028 unless you have protected rights. That matters because you cannot access any of these pots — old or new — before that age without severe tax penalties. Changing jobs does not change that rule.
Three Costly Mistakes People Make With Old Workplace Pensions
Losing track of small pots
The most common mistake is also the simplest: not writing down the provider name, policy number, and membership details before leaving a job. Once your work email closes, tracking down that information becomes genuinely difficult. The ABI estimates the average lost pension is worth £9,470, but for people aged 55 to 75 it rises to £13,620. The fix is straightforward — before your last day, request a pension statement, note the provider and policy number, and update your personal email address with the scheme. Use the Pension Tracing Service if you’ve already lost track.
Ignoring the deferred-member fee increase
Many people assume the fee stays the same after they leave. It often doesn’t. Workplace schemes commonly have a pricing tier for active employees that switches to a higher tier for deferred members. That extra 0.10% to 0.50% compounds silently. Over 25 years, a 0.40% fee difference on a £30,000 pot costs about £4,500. The fix: check the deferred-member fee in your leaver documentation. If it’s higher than what a SIPP or your new workplace scheme charges, a transfer is worth considering.
Transferring a defined benefit pension without advice
Defined benefit pensions — final salary or career average schemes — promise a guaranteed income for life, often inflation-linked, with a spouse’s pension included. Transferring one to a defined contribution pot means giving up those guarantees. UK regulators require regulated financial advice for any DB transfer over £30,000. In most cases, the advice is to keep the DB pension where it is. The cash equivalent transfer value (CETV) rarely matches the long-term value of the guaranteed income.
How to Handle Each Old Pension — Leave It, Transfer It, or Consolidate It
Leaving it where it is
Doing nothing is a valid choice for defined contribution pensions if the old scheme has low charges, decent investment options, and no guaranteed features you’d lose. The provider continues to manage the pot, investments stay in place, and you receive annual statements. The risk is that you accumulate multiple pots over a career — five jobs could mean five separate pensions, each with its own login, statement, and fee structure. That’s where tracking becomes a problem. If you choose this route, keep a simple spreadsheet with the provider name, policy number, and approximate value for each pot.
Transferring to your new workplace pension
Many workplace schemes accept transfers in from previous pensions. The benefit is consolidation — one provider, one statement, one set of charges. The process starts with a transfer form from your new provider. You’ll need the old scheme’s details, and the transfer typically completes in 4 to 12 weeks. Before transferring, compare the annual charges on the new scheme against the old one. If the new scheme’s active-employee fee is lower than the old scheme’s deferred-member fee, the transfer makes financial sense. Also check that the new scheme’s investment options match your risk tolerance and timeline.
Transferring to a SIPP
A Self-Invested Personal Pension gives you full control over where your money is invested. You can consolidate multiple old pots into one low-cost global index fund, often paying 0.15% to 0.45% in annual platform fees — significantly less than many workplace deferred-member tiers. Providers like Vanguard, AJ Bell, and Hargreaves Lansdown accept transfers. The trade-off is that you manage the investments yourself. For people with several small pots from different jobs, consolidating into a SIPP is almost always better than leaving them scattered. The exception is any pot with guaranteed features — check before transferring.
What about defined benefit pensions?
If you have a defined benefit pension from a previous job, the default action is to leave it alone. The guaranteed lifetime income, inflation protection, and spouse pension are usually worth far more than any transfer value. DB-to-DC transfers over £30,000 require regulated advice by law, and that advice typically recommends staying put. If you’re considering it, speak to an FCA-authorised adviser who specialises in DB transfers. Do not make this decision based on a comparison of annual fees alone.
Frequently Asked Questions
Can I lose my pension if my old employer goes out of business? ▾
Does changing jobs affect my State Pension? ▾
What happens if I have a small pot under £1,000? ▾
Can I pay into an old workplace pension after leaving? ▾
How do I find a pension from a job I left years ago? ▾
The Real Cost of Doing Nothing With Your Old Pensions
The most expensive decision isn’t which option you choose — it’s not making one at all. Each old pension left in a higher-fee tier, each pot you lose track of, each year you delay checking the charges — these compound into real money over a working lifetime. The Pensions Dashboards programme, rolling out from 2026, will eventually give you a single view of all your pensions. But you don’t need to wait for that. A spreadsheet and one afternoon of calls can save you thousands.
Remember: this article is general information only. For advice on your specific situation, speak to a qualified professional.
If this was useful, you might also want to read Beyond the Pension: Creative Ways to Fund Your Retirement in the UK.
Sources and Further Reading
Retirement Budgets: Smart Spending Habits for a Comfortable UK Life — Practical guidance on managing your spending in retirement, including how pension income fits into a broader budget.
The Retirement Revolution: Challenging the Norms, Building a Better Future — A wider look at how retirement is changing in the UK and what that means for how you plan.
Unbiased (2024). What happens to your pension when you change jobs. 🔗
RichQuid (2024). What happens to my workplace pension if I change jobs. 🔗
UK Pensions Guide (2024). What happens to your pension when you change jobs. 🔗
Kalkine (2024). What happens to your workplace pension after changing jobs. 🔗
