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Reverend Nick Posted 3 months ago
Naming the person you wish to be your beneficiary re pensions. It’s important!

I mentioned in a General post that I sit on a regional LGPS pensions committee.

Last week had a rather concerning case study. Which was:

Two same-sex partners living independently – one in City A and the other City B.
One of them, sadly, passed away.
They thought surviving partner would automatically get their other half’s pension death benefit. And they didn’t fill in the expression of wishes nomination form because they thought they didn’t need to. Although everybody knew they were a couple – on paper they weren’t. The key wording on the form, is “Do you live as a married couple?” well, yes they did but in different places. This throws a real spanner in the works for the system.

So – be sure you make your nomination of beneficiary quite clear – fill it in as though you are writing to explain to an idiot!

It’s not just a case for LGBT couples – you may be separated from your other half but still wish them to be a beneficiary. – precise instructions apply just as much.

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3 likes & 14 replies
    • Staying Alive 23rd May 2022 at 1:09 pm

      This is very interesting as my daughter is studying law and the other day we were having a discussion on the rights of inheritance, and beneficiaries. Specially since the law for divorce and simple divorce has changed.

      Reply
    • Staying Alive 23rd May 2022 at 1:11 pm

      O and happy birthday 🥳 to you I think it’s today. I seen you mention it in a post

      Reply
    • Robert K 23rd May 2022 at 3:14 pm

      Years ago I was a trustee of our company pension scheme. Part of the pension scheme was a death in service benefit. A member of staff died and (via a nomination form) left the benefit to his niece and nephew. His sister appealed against his decision, claiming the money for herself. This scheme allowed the company to make the final decision on all nominations (to prevent benefits being left to the Cats Home, etc, rather than a partner).

      It is very important to put your wishes in a Will, as well as on a nomination form.

      Reply
      • NannaG 23rd May 2022 at 4:14 pm

        That’s quite interesting Robert regarding the will
        I spoke to a solicitor some time ago when taking out an insurance policy who told me as there was only my son I would leave everything to said don’t bother with a will ??

        Reply
        • Robert K 23rd May 2022 at 5:21 pm

          Personally I would always have a Will. It doesn’t cost much, removes any doubt and makes things straightforward when the time comes. Mind you I’m no solicitor 😀

          Reply
        • NannaG 23rd May 2022 at 5:28 pm

          Yes I am in the mind of just doing it anyway 👍

          Reply
        • Dee Hellem 24th May 2022 at 7:55 am

          Pension death benefits are paid via a Discretionary Trust. Your Will is of no standing in relation to your pension death benefits. It can’t direct who gets them.

          In the absence of an Expression of Wishes the Trustees might use it as an indication of who they think you’d have wanted to get it, but a Will can’t instruct them in relation to death benefit.

          So the answer is you need both.

          Reply
        • Dorothea 24th May 2022 at 11:29 am

          Find yourself a new solicitor! Yes, if there’s no one else, any inheritance will go to your son, but not having a will makes it a lengthier process, as he will have to take some steps to be recognised as your heir.

          Dee’s advice on the original pension question is good – it’s not part of what your will covers.

          https://www.gov.uk/applying-for-probate/if-theres-not-a-will

          Reply
        • Speedbird007 10th June 2022 at 3:11 pm

          I know someone who had an only child who was divorcing, his ex-partner walked off with some of his mother’s jewellery and other family heirlooms. I would definitely make a will to protect what has been handed down your family line…

          Reply
    • NannaG 23rd May 2022 at 4:14 pm

      On the pension side he is my beneficiary

      Reply
    • Cheers on toast 23rd May 2022 at 5:36 pm

      Good post, something no one wants to face but so important. I will work on it thanks.

      Reply
    • Dee Hellem 24th May 2022 at 8:08 am

      An Expression of Wishes is exactly what it says on the tin. An expression of your wishes.

      Pension death benefits are paid out via a Discretionary Trust. That ‘discretion’ means that the value doesn’t form part of the deceased person’s estate for Inheritance Tax.

      You are giving the trustees an indication of who you want to get it, but they are not bound by that.

      There’s a common misconception that if you have a Will that’s enough. It absolutely isn’t. Your Will plays no part in where your death benefits go, though in the absence of any other information the Trustees may ask for a copy to help them determine who to give it to. But it might not be who you would have wanted.

      Expression of Wishes forms are simple to complete. You nominate who you want, in whatever %ages you want, sign it, date it and post it back.

      You can change it at any time, and your scheme will rip up the old one and replace it with the new one.

      It doesn’t cost anything to do and doesn’t need legal involvement or witnesses etc.

      And it applies to personal pensions as well as occupational and works pension schemes.

      And you can provide a narrative for the Trustees to consider as well. For example list your spouse and your two kids as 98% 2% 1% and the followingnarrative ;-

      If my spouse survives me then 100% to them, and if not then 50/50 between my children John and Mary.

      Final tip – if dividing 3 ways 33.3% each doesn’t work, as most Trustees will require it to add to 100%. So 33.3, 33.3 and 33.4 to your favourite!

      Reply
    • Team Rest Less 24th May 2022 at 1:06 pm

      This is a fantastic exchange of thoughts, thank you everybody and thank you so much for starting the thread, Reverend Nick.
      It’s very likely that you know we have a comprehensive section at Rest Less dedicated to will writing https://restless.co.uk/money/wills-funeral-planning-and-inheritance-tax/ and in one of the articles there the letter of wishes is something that is also covered https://restless.co.uk/money/wills-funeral-planning-and-inheritance-tax/ways-to-make-sure-your-will-isnt-challenged/#:~:text=8.-,Leavealetterofwishes,-Ifyouredrawing
      Thank you!

      Reply
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