What can widowed MIL have now?

Cottage_Economy

My father-in-law died a couple of days ago and we found out last night that mother-in-law does not get a state pension as such, only a percentage of father-in-law's pension because she paid reduced national insurance contributions during her working life.

She's 79 (FIL was 82), she was a stay at home wife and then mother before going back to work part time when her sons were in their mid-teens. She told me when she first started back at work she was not able to pay something called superannuation due to the rules at the time, but when the rules changed she did pay and built up 11 years superannuation.

On this limited information, can anyone give me some idea what sources of income she may have access to now her husband has gone. I was so shocked when she told me she's never had much income of her own that my first instinct is to work out what hubby and I need to give her every month to ensure she has enough money to live on comfortably. It will be tough for us to do, but the sooner we can start putting some financial plans in place the better.

Does anyone have any ideas?

xylophone

http://www.direct.gov.uk/en/Pensionsandretirementplanning/StatePension/Basicstatepension/DG_10026707
http://www.pensionsadvisoryservice.org.uk/state-pensions/death-benefits

See above

Did he have an occupational or private pension? Is there a Widow's benefit?

Is it possible that she was entitled to an occupational pension that she hasn't claimed?

http://www.moneymagpie.com/article/perks-for-the-over-60s

Check on pension credit/housing benefit/council tax benefit.

xylophone

And also http://www.ageuk.org.uk/get-involved/campaign/more-money-in-your-pocket/help-claiming-all-benefits/

cte1111

After my Dad died, my Mum's state pension was upgraded with his contributions, e.g. for years where she hadn't contributed and he had, they transferred those over to her pension. I had to ring up the pension people to get this organised and it took a while with various confusing letters appearing but she is now receiving more than she did before he died.

Xylophone has give a link to the information online at direct.gov, you should call them on 08456 060 265 ASAP to start the ball rolling. I found them very helpful and they were happy to take the information from me and then wrote to my Mum to confirm everything later.

ALIBOBSY

Sorry for the loss OP.

I used to do these calculations many years ago when I worked on pensions. The other poster is correct just send a copy of the death cert to the pensions dept (they will need this to close off the FIL's account anyway). The death cert you need is the special benefit ones you can get from the registrars alongside the full "proper" cert. They used to have a section on the back to put the partners details on to claim the increased pension. We used to be able to sort the whole thing within about a week, but since pensions were all centralised I believe it now takes a lot longer.

Once she knows her new rate of pension she may qualify for some pensioner credit, plus if the late FIL had any private pensions when you contact them she may be due something from them as well.

Ensure any insurances they have are claimed on (including any debt insurances such as on loans and credit cards if they had any).
She will likely get some kind of reduction in council tax even if its only the single person discount.

Its a horrible time for her so at least if you can reassure her financially things won't be a huge drop its at least one (all be it minor) worry off her mind.

Ali x

jackyann

Background information: in the infant days of the Welfare State, married women paid a smaller National Insurance "stamp" so that they were entitled to basic benefits, but on the assumption that they would be part of the "married couples' pension". Although they theoretically had the option to pay in on their own account, many did not understand that, or were given misleading information. It was stopped in 1977.
Those women, when they become widows, do become eligible for a pension that reflects their husband's contribution.
Various changes to the system, and the typical profile of married women's working in that era (as you have described) does mean that it gets rather more complex. But I have found the Pensions Agency very good at sorting this all out, so you shouldn't need to worry whilst grieving.

Torry_Quine

When I registered a death recently they were also able to inform the DWP as well which was very helpful. They can also contact DVLA re driving licence, passport agency and many others.

Cottage_Economy

Thank you so much to all who replied and sorry for the delay coming back to you.

jackyann - that is exactly what happened. She admits they made the wrong decision and didn't really understand the implications or impact it would have on them in later life. As a result they took out a small equity release on their property to make up for the shortfall in their income after retirement and have been eaking it out for about 15 years now plus a very small private pension FIL owned, some state pension he was getting and a small amount of state pension she was entitled due based on his NI contributions.
When I posted we hadn't yet registered FIL's death, but have now and as you all rightly said, they are taking care of that side of things which has been a massive help.And this morning she had some wonderful news: it seems FIL's private pension (about £200 a month) is being switched into her name, so that is a massive weight off her shoulders and she's so relieved.
We had worked out that at her current (frugal) lifestyle she would have been £250 short every month, but now with this she is only about £40 short. It may transpire when everything is eventually sorted that she can cover this outstanding amount, although I'm still in favour of giving her a little something every month. She's so frugal she'll downgrade her lifestyle from what it is now to something very meagre indeed and we've no intention of letting her do that.Thanks again everyone. When I find out a bit more on the state pension side of things I'll come back and post again. It might be useful info for someone else one day.

margaretclare

Jackyann is correct about what was called the 'married woman's reduced contribution' or colloquially, the 'small stamp'. I was in the Women's Movement of the 1970s and this was one of the issues we campaigned about - another was independent personal taxation.

There was just an assumption made that you would change to this 'small stamp' if you intended to work while married. It went back to the Beveridge Report of 1942 on which the new Welfare State post-war was based. Although women had done sterling work in both world wars, done jobs that no one ever thought a woman could do, Beveridge thought that post-war 'she has other duties' and those duties were primarily to 'replenish the race'.

Some of us found out the long-term drawbacks of this lower NI contribution and took appropriate action. In addition, part-time staff weren't eligible to join the pension scheme at work, if there was a pension scheme that is. This was what was meant by 'superannuation'.

I worked with many women in the NHS who knew about the lower NI but chose to keep it as it meant 'more money in your pocket now'. I also knew many who deliberately kept their hours just below full-time to avoid joining the pension scheme.

Thanks to sites like this one, there is every reason now to be much better-informed about financial matters and to take control of your financial future.

xylophone

Have you checked on the benefits situation?

Pollycat

xylophone wrote: »

Have you checked on the benefits situation?

Definitely do this, she may be entitled to Pension credit but with a widow's pension of £200 pm and her upgraded state pension, maybe not - but definitely worth checking out.

Also, if she's the only one living in the house, she will get the 25% single person reduction in council tax - but you'll need to let them know.