Sorting out Nan's Workplace Pension after passing away

ShaMLam

My Mum is trying to sort out her Mum's affairs after unfortunately passing away January of this year and her Workplace Pension is causing a few problems. She officially retired on the 23rd December last year after 30 years of service with them, (exactly a week after turning 75) but never filled the form out to receive a Pension Payment straightaway. We contacted the number provided on the form and finally hearing something back over a week ago, they sent a letter with a figure of just over £7000. Is this right? It just seems an awfully low figure for 30 years of Service! She was working part time, does this have a part to play? Or as we think, are they just paying out her contribution to her own pension and not the companies contribution? Do we dispute or not? We also found the most recent correspondence my Nan had with her Pension Scheme which states her Cash Balance Fund is just over £8000 and her Spouse Pension is just under £1500 a year. Completely new to all of this, so any advice or understanding will be greatly appreciated!

Flugelhorn

depends on type of pension but the the problem with some workplace pensions is that while they pay out to the individual and if they die then to a widow(er) or dependant child, there is often little if anything after that. You don't get contributions back, though might get a lump sum if they died within so many years of retiring. 

*** just found this re the "cash balance fund" https://resources.unitetheunion.org/cash-balance-pension-schemes#:~:text=A%20cash%20balance%20scheme%20is,an%20annuity%20with%20the%20balance. it sounds like the £8000 was the lump sum, some of that would be tax free and then the rest taxed.

Keep_pedalling

You would probably be better off asking this over on the pensions board where there are a lot more people with pension knowledge. 

xylophone

You mention that she worked for the company for over thirty years but was she a member of a pension scheme for all that time?
Or was she automatically enrolled into a workplace pension just a few years ago?
Is there a scheme booklet among her papers?
Is there no breakdown of how the amount has been calculated?
In particular, is any tax deduction shown?

Brynsam

If her cash balance fund was £8K (you don't give any indication of the date of the letter), then paying out £7K after tax sounds entirely reasonable, but it's also reasonable for you to understand why. Write to the scheme and ask if they could confirm this is the correct figure, making the point that she worked for the firm for 30 years and you thought it might have been more given her length of service. That should get an answer which sets your mind at rest.

ShaMLam

Thankyou to everyone for the help and advice given, it has really given us some desperately needed clarity! Much appreciated!