Majority of millennials have two or more pensions
A study by the investment platform as part of its Great British Retirement Survey 2021 found two thirds (66%) of workers have more than one pension, with two pension pots being the most common (30%). More than 60% of 18 to 41-year olds have two or more pension pots.
About 15% of working-age people have four or more and the proportion doesn’t change much with age – 13% of under 40s compared with 16% of over 40s. This suggests more frequent job moves among the younger generation, together with auto-enrolment, is having a significant impact on the experience of building up a pension.
The Department for Work and Pensions has previously estimated that people will have an average of 11 jobs during their working lives.
Interactive Investor released the findings as the government’s Pensions Dashboards Programme testing phase gets underway before it officially launches next year.
The Pensions Dashboard is designed to bring together information on all pension pots held by an individual, including information on costs and charges, as well as information on how much is in each old pension and the names of their providers.
Becky O’Connor, head of pensions and savings at Interactive Investor, said: “Younger workers tend to move more quickly between jobs than the older generation did earlier in their working lives. This change in the way careers are built – from ‘jobs for life’ to jobs for two or three years – occurring at the same time as auto-enrolment, means that as people build up experience and pay rises between different employers, they are also building up an increasingly complex pension history.
“Ten years after auto-enrolment was introduced, we are already seeing the effects, with more than half of 18 to 41-year olds having more than two pension pots.
“The Pensions Dashboards are due to launch in 2023 and will enable people to see information about all of their pensions in one place. Although this will be extremely useful, it doesn’t fully mitigate the need to keep all of your pension information for yourself. It will still be a good idea to keep documentation from different providers and pensions, as if you wish to make changes to any of your pensions, for example, to the underlying investments, you would still need to contact the providers directly.”