Expression of Wishes fine print - should we be concerned?

Mosef41

On the Expression of Wishes from my wife and I are being asked to sign for Pension Death Benefits, it states "While the Scheme Administrator will pay due consideration to these wishes, they will have absolute discretion as to the beneficiaries and the proportion of benefit paid to each beneficiary".  Can they go rogue with our money!?  Should we be concerned about this wording?  Thanks in advance for any advice or experience shared.

kuratowski

Essentially this wording is what makes the pension death benefit tax-free, the fact that it's at the trustees' discretion keeps it outside your estate for inheritance tax purposes, which is a good thing.

As I understand it, the main reason they would choose to override your wishes in the event of your untimely death would be because your circumstances had changed (e.g. divorce) and you had failed to update the EOW.

Keep_pedalling

Pretty standard wording, absolutely nothing to worry about.

SevenOfNine

Similar wording to that of a deceased relative. It was to go to a named person (a sibling) & had been signed 3 years previously, as executor my husband was asked if there was anything in the interim the trustees needed to consider before paying out in accordance with the Wishes. There wasn't & payment was made, outside scope of the estate.

Silvertabby

Perfectly normal and nothing to worry about.  

The main reason is that 'payment at the trustee's discretion' keeps means that the money doesn't form part of the estate, and so can be paid to the nominated beneficiary without having to wait for probate/be counted for IHT  etc.

However, it does give the trustees the power to step in and right an obvious wrong....

During my 20 years in the LGPS I have only known the trustees ignore a handful of expression of wishes forms.  Typical example being the chap who had nominated his (then) girlfriend when he first joined the pension fund....20 years later, his life had moved on, and he had married someone else and had children.  The trustees paid the benefits to the wife instead of the old girlfriend.

TBagpuss

AS others have said, it is perfectly normal . Typically it would allow them to use their discretion if the person who died hasn't updated their wishes (e.g. following a divorce or remarriage, or after having children)