Is there a pension for single people?

macman

Caz123 wrote: »

I didn't appreciate that pensions are not 'savings' - I was talking about company pension by the way. I guess I thought that private/company pensions would pay back, although I can see that state pension is different.

I need to get my head around all your comments so thanks to everyone. I am a widow aged 54 with one daughter - thinking of her if I die early! Will now embark on a bit more research.

Then you need to nominate her now as a benificiary should you die within service. The death in service benefits may be considerable.

brianrhill

jamesd wrote: »

1. Personal pensions, where you choose and can change the investments. Many people choose to buy an annuity with this pension pot. It has not been required to buy an annuity for several years now, so if you want to have a pension pot that can be inherited after you die, just don't buy an annuity. Take an income from the investments instead. It's called income drawdown. It's also potentially very beneficial to couples, because 100% of the pot can be inherited by a spouse, without reducing the income while both are alive.

Not quite correct - some annuities provide for Value Protection which ensures all or part of the fund passes to the estate. Any lump sum death benefit from a pension fund is liable to 55% tax, whether from drawdown or annuity, unless it goes to provide a pension for the survivor or dependent through annuity or drawdown. Drawdown is often only suitable for those with >£100k to invest and have an appetite for investment risk.

jamesd

Value protection loses one key benefit of drawdown for a couple - 100% spousal pension without having the income while both are alive reduced. That value protection has to be paid for in an annuity but comes along as part of the drawdown package without extra cost.

Agree about the investment risk potential, not about a £100,000 minimum. That's out of date and doesn't reflect costs of drawdown today, nor the range of income sources that people may have. Drawdown doesn't get more risky at lower pension pot levels, it gets less risky because it is a smaller portion of total income, unless it's part of unavoidable spending. It becomes higher risk at high spending levels and higher pot sizes where most of the income can be dependent on the drawdown, potentially leading to large fluctuations in total income.

Bigmoney2

Caz123 wrote: »

I didn't appreciate that pensions are not 'savings' - I was talking about company pension by the way. I guess I thought that private/company pensions would pay back, although I can see that state pension is different.

I need to get my head around all your comments so thanks to everyone. I am a widow aged 54 with one daughter - thinking of her if I die early! Will now embark on a bit more research.

Some company pensions have a 5 year guarrantee clause, meaning that if you die within 5 yrs of retirement, you or rather your beneficiaries will recieve the outstanding amount of pension.

You should have received some info (booklet) when you joined the scheme which should outline the benefits, or there may be web site giving info.

thenudeone

If you have no dependants or traceable living relatives at all, and haven't made a will, it doesn't matter because even if you keep the money instead of putting it into a pension, any assets you have when you die, will go to the crown!

jamesd

Bigmoney2 wrote: »

Some company pensions have a 5 year guarrantee clause, meaning that if you die within 5 yrs of retirement, you or rather your beneficiaries will recieve the outstanding amount of pension.

To avoid any chance of misunderstanding, that's only the payments of pension income from the start of taking the pension until the end of the five year term. The lump sum remains lost, except in the value protection purchase case. That is, it guarantees at least five years of payments. This option can be purchased when buying an annuity and is usually cheap.