Speaking to camera 'Andrew' says the reason he chose PensionBee is because he was looking for a way to consolidate a large number of pensions.
He loves to travel and PensionBee gives him that ability. He also talks about the ease with which he withdraws his pension from the platform.
The 30-second advert is just one example of the increased marketing by financial companies who have positioned themselves as pension consolidators.
As well as PensionBee, traditional insurers like Standard Life and Aviva are already running TV ads focusing on consolidation, while others are trying to make it easier for people to make them their consolidator of choice.
According to Boring Money’s Online Investing Report 2023, PensionBee and Vanguard made the greatest gains in brand awareness between 2022-23, with each seeing an increase of 6 percentage points in awareness amongst investors.
"However, people are often more risk averse about their pensions and so seek the assurance of a large familiar UK brand, which plays against these newer players. Vanguard is not exactly new, but it is to the average UK pension holder," says James Adams, head of research at Boring Money.
Keith Aylwin, executive director – insurance practice at Alpha FMC, says: “We see big players like L&G, Aviva, Royal London, Abrdn etc actively promoting consolidation – in fact, recent marketing material from them all focuses on it.
“Smaller players too are actively targeting this space to increase assets under management. Similarly, wealth players like St James Place and Hargreaves Lansdown have offerings and even fintechs like PensionBee focus on this heavily.”
Although the defined contribution world is way behind the defined benefit world in terms of assets, it is growing rapidly, says Steve Webb, a partner at pension consultancy LCP.
For example, Nest has reached £30bn of AUM and forecasts that it will hit £100bn by the end of the decade.
Webb says: “If you are a consolidator and can get DC assets consolidated to a scheme that you run, the reward could be great.
“Even a relatively new entrant like PensionBee has accumulated more than £3bn in just a few years, overwhelmingly from consolidation.”
So, what is driving the demand for pension consolidation, and is transferring all of one’s pension pots into a consolidator value for money?
Looking at the stats
According to the Pensions 2022 report by Boring Money, 60 per cent of 25 to 34-year-olds agree they only hold a pension because of auto-enrolment, while 46 per cent of the non-retired hold two or more pensions.
Adams adds: "The propensity to hold multiple pensions will only continue to increase, with AE helping to drive up to the number of pots held, so there is potential for consolidation to become more popular."
Since the introduction of AE 10 years ago, more than 95 per cent of private sector employees who have been auto-enrolled have been put into a DC pension, says Mark Pemberthy, benefits consulting leader at consultancy Buck.
