Pension on death of husband

forgotmyname

I dont have a great deal of info, but i will do my best to ask what i think that need.

Her husband passed away very recently, she gets a reduced state pension due to working part time between bringing up the children. That sounded odd to me but there you go.

He received a full state pension and a small private pension, this pension was in his name only because it would have reduced the monthly amount, making it almost worthless. Unexpectedly though he passed away much sooner than they both expected. Was this a big mistake?

I think thats the basics, the question is she is now worried about what she will receive, her state pension wont cover the bills. But they did have savings of approx £40k. Some of this will go towards the funeral though.

Am i right in thinking the private pension is now over and done?

Someone mentioned that she maybe entitled to part of his state pension or get pension credits? but will the savings go against that?

Thanks in advance.

badmemory

This is a quote from NI direct.gov

"Your widow, widower or surviving civil partner may be entitled to some State Pension based on your National Insurance contributions (NICs) if they have not already built up a full basic State Pension on their own NICs record."

This should mean that she will receive an increase to her state pension. She can also claim pension credit if necessary, but that will be reduced by the savings.

Marcon

'...this pension was in his name only because it would have reduced the monthly amount, making it almost worthless. Unexpectedly though he passed away much sooner than they both expected. Was this a big mistake?' To be honest, it's too late to be speculating on whether that was a mistake; that was the decision he/they took at the time and it can't be changed. What is worth checking, though, is how long the pension had been in payment and whether there is any 'guarantee' period left (the guarantee period is basically a promise by the pension provider to pay a certain minimum number of years of pension - usually five - even if the pensioner dies within that period). If the guarantee period has passed, you are right: the private pension is over and done with.

Without knowing age etc, it is impossible to help with the rest of your question - but the Pensions Advisory Service can give free, impartial information and/or contact points for more help: http://www.pensionsadvisoryservice.org.uk

jamesd

Any mistake is too late to rectify now so best to move on with what can be done.

What happens to a private pension depends on the nature of the pension so no way for us to say at the moment. If it was a workplace final salary type of defined benefit pension there might be a spousal pension that she would be entitled to. She should contact the administrators of the pension to ask about this. If the pension comes from buying an annuity what happens depends on the type of annuity purchased. There are options that would pay out for a set number of years from the date of purchase, often five or ten years. There's also the option to buy one with a pension for a spouse after death or dual life annuities. again, checking with the administrators would be the way to go.

Pension credit will provide a minimum level of income even if her state pension is lower. Savings will reduce this for a while, depending on how much is left because some will be assumed to be producing an income of about 10% of the value. Assuming she reached her state pension age before 6 April 2016 there's Savings Credit available that would reduce this reduction.

Citizens Advice offers an excellent benefits check service so the best thing for her to do at the moment is to gather all of the financial details and arrange a check.

xylophone

Re state pension see information here http://www.ageuk.org.uk/Documents/EN-GB/Factsheets/FS19_State_Pension_fcs.pdf?dtrk=true

This may also be of help.

http://www.ageuk.org.uk/Documents/EN-GB/Factsheets/FS48_Pension_Credit_fcs.pdf?dtrk=true

Your friend will have advised DWP of her husband's death?

You refer to his private pension - if this was an annuity without any spouse provision then it is likely that the pension has died with him - however, your friend should advise the pension provider of his death and see what transpires.

Your friend is now alone in the family home? Has she contacted the council about single person discount for Council Tax?

Malthusian

forgotmyname wrote: »

He received a full state pension and a small private pension, this pension was in his name only because it would have reduced the monthly amount, making it almost worthless. Unexpectedly though he passed away much sooner than they both expected. Was this a big mistake?

Hindsight is 20/20. If as you say the pension was so small that with a joint life annuity it would have made no difference to their lives, then it probably wasn't a mistake at the time.

If she herself passes away within a few years, god forbid, then it will probably revert to being the right decision even with hindsight (as the total she would have received from a widow's pension will be less than the extra income they received during his lifetime).

As others have said, no point dwelling on it.

atush

Savings will reduce this for a while, depending on how much is left because some will be assumed to be producing an income of about 10% of the value

Dont see how this can still be the case, bearing in mind you cant get anywhere near that income for savings. Sounds like it need to be revalued to take into account savings rates.

dunstonh

He received a full state pension and a small private pension, this pension was in his name only because it would have reduced the monthly amount, making it almost worthless. Unexpectedly though he passed away much sooner than they both expected. Was this a big mistake?

Including spouse in the annuity would have reduced the annuity rate. Prior to G Day (gender neutral quoting) the cost of including a spouse was quite high. Especially for men including a wife. Not so much the other way around. And if the wife was younger.

So, a lot of people would not include the spouse on smaller pension incomes and take the chance.

You don't know your date of death. So, you can never tell which options are going to be the best ones to select until you look back with hindsight.