Transferring and consolidating your investments

At a glance

• Consolidating your investments can provide you with a clearer picture of your wealth
• It can make it simpler to take advantage of your various tax allowances
• Consolidation can reduce costs and help your loved ones to better understand your finances
• Before you transfer, there are a few things you may wish to consider

What are the benefits of transferring and consolidating your investments?

Managing multiple investment accounts can be onerous. So whether it's combining fragmented Individual Savings Accounts (ISAs) you've opened over the years and taken your eye off, or workplace pensions from several former employers, consolidating your investments into a single, or fewer, providers can offer numerous benefits.

1. A clearer picture of your wealth

One of the primary advantages of consolidating your investments is gaining a clearer understanding of your financial situation.

With ISAs, it can be easy to lose track of accounts, especially if you frequently switch providers for better deals. By transferring your ISAs – or any Junior ISAs (JISAs) held on behalf of a child – into one place, you can more easily monitor their performance and understand the full value of your family's wealth. 

Similarly, consolidating your pension pots can provide a clearer view of your potential retirement income, helping you assess whether you're on track to achieve your retirement goals. 

Conducting a regular portfolio review can be complex if you've got multiple portfolios from different providers. It doesn't help if your various investment managers use different terminologies to describe the management styles or risk levels applied to your portfolios. 

Consolidating your investments could help you better understand what you're actually invested in. This can help you stick to certain investment principles such as diversification. 

Some people believe that having multiple providers means you're automatically more diversified, as you don't have all of your eggs in one basket. Using different providers could offer access to a broader range of investments, where each could offer a distinct focus. However, merely having more investment accounts does not automatically increase diversification. 

You could find that your different providers are investing in products or funds with similar underlying assets. This could mean you have more overlapping investments than you realise. Having overlapping investments can actually reduce diversification.

While having different investment pots with fewer providers could still result in some overlap, it should be easier to see what you own holistically. J.P. Morgan Personal Investing's app, for example, allows you to see a breakdown of your exposure, across different investment pots or tax wrappers (ISAs and pensions).

2. It's easier to keep on top of your tax allowances and limits

Navigating the tax world is inherently complex, especially given that the rules are susceptible to change.

If you have fewer ISA and pension pots that you're actively contributing to each tax year, you'll likely find it easier to monitor your own contributions and ensure you're making the most of your tax allowances. However, if you have several providers for each product, then it can be harder to keep tabs.

For example, if you accidentally exceed your allowances of £20,000 for an ISA (of which up to £4,000 can be in a LISA) and separately your £9,000 limit per child's JISA (which is not included in the £20,000 ISA limit), HMRC will typically identify the excess contributions when it receives information from ISA providers. You'll then be required to remove the excess funds, and any income or gains already generated may be subject to tax. 

When it comes to pensions, things can be even trickier. For most people the annual allowance is 100% of their annual earnings, or £60,000, whichever is the lower. This includes contributions made by you or an employer. For very high income earners the annual allowance is less, due to the tapered allowance. 

You can carry over unused annual allowances from the previous three tax years, although there are some quite complicated stipulations and so it may be worth speaking with an accountant or adviser in addition to your pension providers. If you make a mistake, the excess amount can be subject to an Annual Allowance Charge. 

At J.P. Morgan Personal Investing, you can set a personalised contribution limit in the app to make it easier if you are managing multiple providers.  

3. Potentially reduced costs

Long-term cost efficiency can be another compelling reason to consolidate your investments. Fees associated with management, account maintenance, transactions, withdrawals, and platform activity (or in some cases even platform inactivity) can all erode your wealth.

Managing multiple small pension and ISA pots can be more expensive than fewer, large ones. If your provider runs a fixed-fee or minimum-fee model and your underlying holdings are similar in different accounts, do you really need to be paying several different investment houses to analyse the same assets? The lower the value of your funds held in each account, the more you'll be impacted by several fixed or minimum fees.

On the other hand, if the total value of your investments is on the higher end, you could also be missing out on preferential fees if you spread them too thinly. For example, a J.P. Morgan Personal Investing client who invests above £100,000 can benefit from reduced fees for the portion of their funds beyond this amount. To find out how this could apply to your investments, speak to our wealth experts at a time that suits you.

It's crucial to review and compare the fees associated with your investments and choose providers that offer good value – another task that's easier if you have fewer to wrangle. You should, however, check with your existing providers about any charges for transfers before transferring, as there may be some associated costs. You should also check whether you will lose any benefits or guarantees.

4. Align risk levels

It's important to ensure that your investments are conducted with an approach to risk that is appropriate to your financial objectives. Having numerous investment accounts unintentionally calibrated to different risk levels, possibly because of differences in the way providers tackle risk, could lead to a collision of mixed strategies directing your investments in a manner that isn't suitable to you. Consolidating under one provider can mean a more consistent approach to risk and a cleaner journey towards meeting your goals.

5. It can be simpler for loved ones to understand your wealth

It's never a pleasant topic, but it's worth addressing. Consolidating your investments can make it easier for your loved ones to manage your finances in the event of your passing or severe illness, which could provide peace of mind for you and your family. Streamlining your accounts simplifies the process of reporting a death and establishing beneficiaries. It could also help an attorney manage your affairs if you were to lose the mental capacity to be able to do this yourself. 

What happens to my investments when I transfer them?

Research carried out by Opinium on behalf of J.P. Morgan Personal Investing found that 23% of UK investors surveyed believed that transferring an 'old' ISA would impact their allowance for the current tax year¹. This is incorrect.

If you transfer an ISA, JISA, Lifetime ISA (LISA) or pension using your chosen provider's official transfer process, the transfer won't affect your annual allowance in the current tax year. It does not matter if you contributed the funds in the current tax year or previous tax years, and any returns remain free from tax.

For example, you could transfer £60,000 saved across three ISAs (of which £14,000 was contributed in the current tax year). In this scenario, all £60,000 could be transferred without impacting your annual allowance. Your remaining allowance would still be £6,000, as your annual allowance is £20,000 and you've already contributed £14,000 this tax year. 

The pensions annual allowance is more complicated. However, the same principle applies that the transfer itself does not count as a new contribution.

Never withdraw the money yourself. If you withdraw money from one ISA to contribute to another, you’ll lose the tax benefits, while that money will also have used up that portion of your annual allowance. If you withdraw from a pension before the age you are allowed to do so, you may also have to pay tax on this, which could be up to 55% if you are under 55.

You should also keep in mind that if you transfer from an ISA into a LISA, the transfer will count as a LISA contribution, so you can’t transfer more than the annual £4,000 LISA allowance. J.P. Morgan Personal Investing does not facilitate an ISA into LISA transfer presently. 

Would my investments stay in the market during a transfer?

While the whole process of an ISA or pension transfer may take several weeks, your money is unlikely to be out of the market for more than a few days. This may mean losing out on potential returns during this short time (but also avoiding potential losses). 

Things to consider before transferring

Having investments in different places could give you more choice, and your existing products could potentially offer you more benefits. It's important that this is a conscious decision and one you're keeping on top of. 

For many people, accumulating accounts can happen haphazardly – the result of switching jobs or experimenting with new apps over the years. If spreading your investments across providers wasn't your intention, you should still check whether consolidating would result in the loss of any favourable fees, guarantees or benefits before you transfer.

Some people choose to have multiple ISA or pension accounts for the following reasons:

1. Retaining benefits: Certain pensions have benefits that may be lost if you transfer them – such as a defined benefit pension scheme (sometimes called a final salary pension). If you're unsure if this applies to you, you can always check with Pension Wise. You should also consider getting financial advice.

2. Receiving employer contributions: Similarly, if you have a pension with a current employer you may lose employer-matched contributions if you consolidate this into a private pension. J.P. Morgan Personal Investing allows employer contributions into personal pensions, but you should check if your employer would be willing to contribute into a personal pension of your choosing, before making any decisions.

3. More choice: Experienced investors may find that no single ISA or pension provider offers access to all of their desired investment vehicles. If this is the case for you, you may want to only consider transferring where you have duplication. Check what your providers do and don't offer before consolidating.

4. FSCS cover: The Financial Services Compensation Scheme (FSCS) currently provides compensation in certain circumstances up to £85,000 per person, per financial institution – assuming they are authorised by the Financial Conduct Authority (FCA) – and so having multiple accounts below this limit can be reassuring.

Speak to our wealth experts

It's important to take stock of the potential benefits of having multiple investment accounts. Consolidating your tax-wrapped investments with fewer providers could simplify management, reduce costs, and provide a clearer picture of your overall financial situation.

Ultimately, the decision should be based on your individual financial goals, preferences, and circumstances. If you're unsure whether this is the right move for you and your financial goals, you can speak to our wealth experts.

Sources:
1. Fieldwork took place between 9-16 January 2025 by Opinium on behalf of J.P. Morgan Personal Investing. The survey was comprised of 1,000 UK investors. Opinium Research is a member of the British Polling Council and abides by its rules.

As with all investing, your capital is at risk. The value of your investments with J.P. Morgan Personal Investing can go down as well as up and you may get back less than you invest. Tax rules vary by individual status and may change. Product rules apply. Before you transfer, check you won’t lose any guarantees or benefits, and that you know what charges you may incur. If you are unsure if a transfer is right for you, please seek financial advice. J.P. Morgan Personal Investing is a J.P. Morgan company which offers investment products. Investments not guaranteed by JPMorgan Chase Bank, N.A.