What happens to my state pension when Idie?

As a respected independent financial adviser, I do get asked this question quite a lot. So, I’ve written this piece which goes over what happens to your state pension when you die, and details on how you can claim state pension if your spouse has died.

 

Firstly, there are actually several different types of state pension, and the one you have will have a direct effecton how you claim it and also if you can claim any extra state pension, if your spouse dies.

 

If you were born before 6thApril, 1951 for men and 6thApril, 1953 for women, you are entitled to claim the basic state pension. If you were born after these dates, you will claim the new state pension. There are various rules for each of these types of pension schemes.

 

A big concern for most people is exactly what will happen to their state pension,should they die. Could it be inherited? Can their spouse get any extra money? The simple answer for the majority who haven’t retired or gotten married yet is no – the process under the new state pension legislation is that you and your spouse contribute separately and as a result will withdraw separately.

 

However, if you married or reached state pension age before 6thApril 2016, there are a differentset of options that can apply, all dependent on which pension type you have, and also when you got married or reached state pension age.

 

The rules here can be quite complex. If you are confused or just want to see what you may be able to get, speak to an independent financial adviser. They can assist you in figuring out what you are eligible to receive and how you can claim it.

 

Basic State Pension

 

If you are entitled to the basic state pension, there are a couple of different ways that your spouse could be able to claim it.

 

Firstly, if you hit state pension age before 6thApril, 2016, then your spouse should get in touch with the Pension Service once you die, to check what they are entitled to claim. They may well be able to increase their personal basic state pension with your qualifying years – if they don’t currently receive the full amount.

 

If you get to state pension age on or after 6thApril, 2016, or perhaps your spouse is under the state pension age when you die, they will need to contact the Pension Service or use the gov.uk tool to see exactly what inheritance they might be entitled to.

 

You may have been able to defer or top up your basic state pension, in order to receive an extra amount. If you’ve done any of these, your spouse should generally be able to claim the topped up or deferred amount.

 

With a basic state pension, it is possible to defer or top it up with the intentionof receiving an extra amount. If you have done any of these, your spouse should generally be able to claim the deferred or topped up amount.

 

Book a pension review

 

New State Pension

 

With new state pensions, you usually cannot inherit your spouses pension. It is possible to inherit an extra payment on top of your new state pension if you’re widowed, but this isn’t guaranteed. You will not inherit anything should you remarry before you hitting state pension age.

 

Your new state pension is based on the National Insurance contributions you have paid in.

 

There are numerous ways you can increase your new state pension. You can pay into an Additional State Pension scheme, you might have protected payments, perhaps an additional state pension or lump sum. With the majority of these schemes, there is at least some provision, if only for a part of the extra money to be inherited by your spouse.