State Pensions – What happens to them after you die?

After your death, your spouse or partner may be entitled to receive part of your State Pension.  This could be a percentage of your pension, their own pension based on your National Insurance contributions, or bereavement benefits.

If you die, your partner may qualify for bereavement benefits.  Also, in lieu of a National Insurance contributions record (perhaps due to studies, unemployment or travelling abroad), they could use yours as a pension basis, providing that you had contributed for 90% of your working life. It is also a possibility for them to receive a reduced-rate pension if you did not contribute this much.

If your beneficiary is below the State Pension Age (SPA)

In ordinary circumstances, upon reaching the age of retirement, they would receive a Basic State Pension (BSP) which is based on how much National Insurance they have paid in their working lives.  However, if they are not eligible for a BSP, there are two things that can happen.

Firstly, if they are receiving a Widowed Parent’s Allowance (WPA) after your death, and are still receiving this when they reach their SPA, they could be eligible for a BSP based on the same rate as the pension in their WPA.  If combining your benefits with their own, they cannot receive a pension bigger than £97.65 per week (2010-2011).

If they are not receiving a WPA, and have not remarried, your spouse or partner may be eligible for a BSP, or can increase their own BSP by substituting your National Insurance record for their own.  However, this can only be for the period from when you were married, until the date of your death.  You cannot include records from before your marriage.

It is possible that your beneficiary could also receive part of any Additional Pension that you have saved, as long as they are over 45 and are receiving a Bereavement Allowance or WPA.

If your partner remarries or enters a new civil partnership before they reach their SPA, they will lose their rights to some of your basic pension.

If your beneficiary is above the State Pension Age (SPA)

If they are above the SPA, and did not previously qualify for a pension, they may begin receiving one based on your records immediately.  If they are already receiving a reduced-rate pension, they can top this up to a full-rate pension, using your contribution records.  If your record happened to be lower than theirs, they can still use it to top-up their current pension.

Widows can claim the basic pension you were entitled to at the time of your death, based on your records.  She can also receive her own pension benefits, but she may not exceed the amount of £97.65 per week.  For widowers or civil partners, they may only claim your basic pension entitlement if you were over your SPA when you died.

If on the occasion of your death, you were not entitled to a State Pension, your spouse or partner may receive bereavement benefits.

Bereavement Benefits

Your spouse or partner may be eligible for these benefits in the event of your death.  This could mean receiving a Bereavement Allowance for one year, a one-off Bereavement Payment, or a Widowed Parent’s Allowance (if there are any dependents in the household).  These benefits will again depend on your National Insurance contributions record. If they are below their SPA, they can also still claim tax credits.

This table compares four saving products that can help you to save more for your retirement. We have chosen products that can bring you extra money in the future. Which one to choose from, it will depend on the type of investment you want.

Provider	Product	Advantages	Disadvantages	More Info
	MoneyBuilder	• Tax free end cash pay-out • Monthly contribution starts at only £10 • Life cover included	• 15 years plan • Early “cash in” is not an option as you will lose too much
	Stocks&Shares ISA	• Returns free of Income and Capital Gains Tax under ISA rules • Monthly contribution from £30 • No restrictions on the amount of time you keep the money invested • You can transfer the ISA	• £10,680 maximum contribution in one year • It isn’t risk free
	Cash ISA	• Good online support and advising • You can transfer the ISA • They won’t charge for withdraws • You know what savings rates to expect • Tax free interest	• £5,340 maximum contribution in one year
	3 year Fixed Rate ISA	• Fixed rate, risk free • You can transfer the ISA • Tax free interest	• £5,340 maximum contribution in one year • Limited to 3 years

More Information on State Pensions

Additional State Pension

Voluntary National Insurance Contributions

State Pension for the Self Employed

Deferring your State Pension

What happens when you die?

Contracting Out

State Pension – FAQ