Why is it so difficult to switch a pension? Navigating the transfer maze

When I landed my first job in my 20s, my workplace pension felt like an afterthought – thrown at me with zero guidance.

Defaults weren't a thing, investment choices were a guessing game, and engagement was non-existent. With no tech to simplify things, no paperwork that made sense of what it meant and no customer service to lean on, I did what many did: picked an option at random and then forgot about it.

Looking back, it's clear how far the industry has come – but also how much further it still needs to go.

Fifteen years later, after starting my own business, my pension remained neglected. It still didn't feel like a priority, and my future finances still seemed too far off to properly worry about. In hindsight, that was the ideal time to transfer my pension to a provider that encouraged engagement and enabled contributions.

Five years later, in March 2020 – just before the first Covid lockdown – I joined PensionBee. Working in pensions made me acutely aware of how challenging it is for people to manage multiple pots.

Now in my 40s, I decided it was time to track down my old workplace pension and consolidate everything with my new employer.

Accessing my old workplace pension was the first hurdle. Managed by a third-party administrator, the technology was outdated and not at all intuitive - I couldn't contribute into my pension. I initiated the transfer in 2020 but got too busy - life and work took over. This delay mirrored the real struggles many people face – too much admin, too little time.

By 2024, I was proactively saving into my new personal pension, making investment choices, adding contributions and generally feeling more engaged and far more confident. It was time to sort things out. I wanted the same accessibility, transparency and control as I have with my bank accounts – on my phone, available whenever needed.

Navigating the pension transfer maze

In November 2024, I started digging through old emails to access my pension online. The provider used a third-party administrator, and the portal technology left a lot to be desired. After multiple password resets, I finally logged in – only to realise I'd never updated my details after getting married. Before transferring, I needed to change my name, so I promptly submitted my ID and marriage certificate. Locating my policy number was the next challenge - the information simply wasn't available on the portal or any documentation, and in the end I had to email the administrator.

Three weeks passed in December with no response. After chasing them up, I finally received confirmation that my details had been updated, along with my policy number. Progress at last!

Come the New Year, I was determined to really make things happen. Armed with my policy number, I initiated the transfer via my employer's app. The providers exchanged information, and PensionBee sent a letter of authority to handle the transfer.

Moving into February, my employer contacted the administrator for the necessary transfer forms, only to find they had been sent to me instead of them. I forwarded the forms, and they were promptly reviewed and a special benefit was flagged – protected tax-free cash – that I would lose on transfer. After considering the options, I decided the benefits of consolidation outweighed the benefit, and I confirmed my decision to proceed. I submitted the completed forms, thinking I was now almost there.

By March, I thought I was on the home stretch, but then another setback. The administrator requested photographic ID and a recent utility bill, despite having received my ID back in November. Since most bills are now digital and in a portal somewhere, finding a suitable one was a hassle, but I eventually located a water bill and submitted everything, thinking I was finally done.

But no. The administrator then asked me to complete an 11-page, 73-question scam questionnaire. My heart sank. Transferring to an Financial Conduct Authority-regulated provider shouldn't require such excessive checks, but despite me making this point, they insisted saying it was just their procedure. I duly filled it out and submitted it.

Now, I wait. The provider's standard turnaround for transfer settlements is three weeks from receipt of full documentation – so let's see what happens next.

The transfer process has been unnecessarily complex and time-consuming, with too many poor excuses for delays along the way. If I didn't work in pensions, I might have simply given up on many occasions along the way.

When my pension does finally move across, I'll feel an immense sense of relief.

Lisa Picardo is chief business officer UK at PensionBee