As National Pension Tracing Day approaches, it's time to shine a light on an issue that affects the financial well-being of countless individuals: lost pension pots.

A “lost” pension pot is a pot owned by someone with whom the relevant pension scheme provider has lost touch. This could mean that the pension saver is losing out on money that would improve their quality of life in retirement – or even allow them to retire earlier than they thought.

According to the Pensions Policy Institute (PPI), the total value of lost pension pots grew to £26.6 billion in 2022. The PPI suggested that a combination of automatic enrolment and a post-lockdown increase in job mobility has created a high number of deferred pension pots. People may be moving jobs without realising they were enrolled in a pension scheme by their old employer. If they then change address without the pension provider’s knowledge, the pot may be lost.

Sunday 29 October is National Pension Tracing Day. This is supported by a group of pension providers and aims to reunite people with their pension pots. Those who might have lost pension pots are encouraged to:

• think about the places they have worked previously;
• look through paperwork for old pension statements;
• make sure their pension providers have up-to-date contact details;
• identify gaps in their pension history – the Government’s Pension Tracing Service can be used to find out which pension scheme is used by a particular employer;
• contact the relevant pension provider to see if they have a record of their pension.

The National Pension Tracing Day website provides further information on these steps in its step-by-step guide to tracking down a possible lost pension.

Those who discover a pot they didn’t know about might want to consider:

• changing investment strategy (for defined contribution schemes);
• transferring to a pension scheme with lower charges; or
• consolidating their pension pots.

Any of these could save money and might be a sensible option, but the usual pension scam warnings apply. Individuals should check that any financial adviser contacted for advice is on the Financial Conduct Authority’s list of regulated companies, and they shouldn’t be rushed into making decisions.

Tracing a lost pension can result in additional income which can be used for a higher standard of living in retirement. The money in these pots belongs to the members, so everyone who thinks they might have a lost pension pot is encouraged to embark on their own pension tracing mission without delay!

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