Leaving Pensions and Assets to Children

andrewandyandrew

I want to name my children as inheriting my pensions. They are presently 9 and 12 but my pensions are one of my principle assets and I want to give them a better start that I got. I presume the pension company won’t give them access to pensions now ( and not would I want them to). How do I ensure they are granted access at 18 or better still at 25. My wife will inherit in excess of 1m prior to her retirement age from two benefactors as well as having her own teachers pension and will not need this money for her retirement. 

HobgoblinBT

Pensions are held in trust by the pensions trust so are outside of your estate.  Does your pension scheme give you the ability to name beneficiaries in the event of your death, perhaps through its on line portal?

andrewandyandrew

Yes my children are the named beneficiaries ( sorry I should have added I’ve just done this online) but the documentation I can access appears unclear if the beneficiaries are under 18.

HobgoblinBT

Look at the scheme rules.  The pension trustees will have discretion as to beneficiaries and if they can make advances for the benefit of minor beneficiaries, eg for maintenance and education.  If the required rules are not available online, contact the scheme administrators who should be able to provide an answer.  

Hope that helps.

Savvy_Sue

In my (admittedly limited) experience, when minors are the beneficiaries of a deceased parent's pension, they've been able to receive a monthly pension until the age of 18 or the end of education, obviously paid through a responsible adult. I'm not sure that it continues to be paid once they are adults, or whether any further funds are available to them, but it's definitely worth checking with your pension scheme what the situation is. 

xylophone

DC pensions?
https://techzone.adviserzone.com/anon/public/pensions/Tech-guide-DC-death
Drawdown arrangements can be created for minors. Any withdrawals must be made by a person with parental responsibilities towards the child, and applied for the child's benefit. There's no longer a requirement for drawdown payments to minors to stop at age 23.

With a DB Scheme, there is usually an automatic spouse pension and  pensions for dependants in certain circumstances, notably for children in full time education up to the age of 23.

https://www.pruadviser.co.uk/knowledge-literature/knowledge-library/death-benefits-defined-benefit/

andrewandyandrew

Yes DC - this makes a lot of sense through solicitor.

Marcon

andrewandyandrew said:

Yes DC - this makes a lot of sense through solicitor.

You say you want to give them a good start in life, but you do realise that they can't inherit your pension (or access it directly) while you are still alive. Hopefully you'll be around to see your children reach 18 and well beyond 25.

Be aware that as you are contemplating walking out (as your thread last month seems to indicate: https://forums.moneysavingexpert.com/discussion/6260882/inheritance/p1), a divorce settlement could alter everything.