Hundreds of thousands of state pensioners are bracing for a lengthy wait to access their savings this festive season, with payment transfers facing delays of up to 24 days. New analysis reveals that most people starting the process now will not see their funds move until January, causing significant financial strain.
Christmas Crunch Creates Pension Gridlock
According to data from My Pension Expert's Retirement Fairness Index, the time needed to complete pension transfers surges dramatically in December. The process now takes an average of 24 days, compared to an annual average of just 18 days. This near week-long extension is directly impacting savers hoping to manage their finances over the costly Christmas period.
The research highlights a stark contrast based on pot size. Transfers involving funds worth less than £40,000 take an average of 20.4 days to complete. For pots valued between £40,000 and £80,000, the average time is slightly quicker at approximately 18.5 days. In the most extreme case recorded by My Pension Expert, a transfer took a staggering 244 days – more than eight months.
Expert Warnings of 'Real Frustration' for Savers
Lily Megson-Harvey, Policy Director at My Pension Expert, emphasised the pressure this places on households. "December puts real pressure on household budgets and it is often a moment when people want clarity over their pension," she explained. "However, our data shows that transfer times are highest during the Christmas period, which we know can be a real frustration for savers."
Megson-Harvey urged anyone considering a pension move or withdrawal to contact their provider immediately and allow as much time as possible. She called for greater transparency and accountability from pension firms to ease the pressures. "What matters is that people feel supported to make decisions with confidence. Access to clear information and affordable advice can also make a huge difference," she added.
Industry Reforms Promise Faster Future Transfers
There is hope on the horizon, however, in the form of proposed regulatory changes. Lisa Picardo, Chief Business Officer UK at PensionBee, welcomed the Financial Conduct Authority's (FCA) plans to enforce a consistent 10-working-day response time and mandate the acceptance of digital signatures.
"The industry has been plagued by excessively slow transfer times, inconsistent practices, and providers that routinely reject perfectly valid digital signatures," Picardo commented. "These reforms set a clear and enforceable expectation: consumers should be able to move their pensions efficiently, securely and without unnecessary friction."
She stated that mandated 10-day response times would force firms to build operational efficiency, reducing the pervasive delays that harm consumer trust. Furthermore, the widespread adoption of digital signatures should consign the dreaded 'wet signature' – a major cause of transfer stagnation – to the past.
For now, pension savers are advised to plan well ahead, seek clarity from their providers, and brace for a slower process during the festive administrative slowdown.
