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Do you have a frozen pension? A frozen pension is often a term used to describe old workplace pensions that you’re no longer contributing to. Technically, a frozen pension is more accurately known as a ‘Preserved Pension’ as the pension isn’t frozen, you should still be receiving the providers’ annual statement with a pension fund value and can access the funds.
A BBC article (Feb 2017) quoted “a UK worker will change employer every five years on average”. Many of these could include a workplace pension as part of the salary package.
Can I move a
Depending on the type of pension you have, you should be able to move frozen pensions into a more suitable policy. There could be restrictions and exit fees put onto the pension if you move, so it’s always advisable to get a full breakdown on the terms of the pension policy.
If you were employed in the public sector and received a defined benefit pension as part of your salary package, these are usually unfunded schemes, and you may not be able to move these pensions.
Does a ‘frozen pension’
The short answer is most probably ‘Yes’, your frozen pension should still grow. The rate of growth could be reduced though as you nor your old employer will be contributing to the pension. The pension performance could also be affected by providers fees, market conditions and poor investments all reducing the retirement funds you could be enjoying. In extreme cases, the pension fund could be completely eroded due to the charges.