Generally speaking, a retirement plan document’s provisions specify the options for beneficiaries to distribute their assets. Benefits upon death from a pension vary based on the type of pension you have.
Losing a loved one is never easy, and the process of dealing with their estate can be overwhelming. One of the many things you may need to handle is claiming any pensions they were entitled to.
This guide will walk you through the process of claiming a pension after death, including who is eligible to claim, what documents you need, and how to file a claim.
Who is eligible to claim a pension after death?
The eligibility to claim a pension after death depends on the specific terms of the plan. However, in most cases, the following individuals are eligible to claim:
- Spouse or domestic partner: This is usually the first person in line to receive the pension benefits.
- Children: If there is no surviving spouse or domestic partner, the children of the deceased may be eligible to receive benefits.
- Other dependents: In some cases, other dependents, such as parents or siblings, may be eligible to receive benefits.
What documents do you need to claim a pension after death?
To claim a pension after death, you will typically need to provide the following documents:
- A certified copy of the death certificate
- The deceased person’s Social Security number
- The name and contact information of the beneficiary or beneficiaries
- Any other documentation required by the plan administrator
How to file a claim for a pension after death
To file a claim for a pension after death, you should contact the plan administrator. The plan administrator is the person or organization responsible for managing the pension plan. You can usually find the contact information for the plan administrator on the plan’s website or in the plan documents.
Once you have contacted the plan administrator, they will provide you with a claim form and instructions on how to complete it. Be sure to follow the instructions carefully and provide all of the required documentation.
What happens after you file a claim?
Once you have filed a claim, the plan administrator will review it and make a decision on whether to approve it. If your claim is approved, you will typically receive the pension benefits in a lump sum or in installments.
Other benefits that may be available
In addition to pension benefits, there may be other benefits that are available to the survivors of a deceased person. These benefits may include:
- Social Security survivor benefits
- Veterans benefits
- Life insurance benefits
- Unpaid wages
Tips for claiming a pension after death
Here are a few tips for claiming a pension after death:
- Start the process as soon as possible. The sooner you file a claim, the sooner you will receive the benefits.
- Be organized. Gather all of the necessary documentation before you contact the plan administrator.
- Ask for help. If you need help filing a claim, you can contact an attorney or a financial advisor.
Claiming a pension after death can be a complex process, but it is important to understand your rights and options. By following the steps outlined in this guide, you can increase your chances of receiving the benefits you are entitled to.
Frequently Asked Questions
Q: What happens if the deceased person did not name a beneficiary?
A: If the deceased person did not name a beneficiary, the pension benefits will typically be paid to their estate. The estate will then be responsible for distributing the benefits to the beneficiaries.
Q: What happens if the deceased person’s pension plan does not provide for survivor benefits?
A: If the deceased person’s pension plan does not provide for survivor benefits, the surviving spouse or dependents may be able to receive benefits from other sources, such as Social Security or veterans benefits.
Q: How long does it take to receive pension benefits after death?
A: The time it takes to receive pension benefits after death can vary depending on the plan administrator. However, you can expect to receive the benefits within a few months of filing a claim.
Q: Can I roll over pension benefits into another retirement plan?
A: In some cases, you may be able to roll over pension benefits into another retirement plan. However, you should check with the plan administrator to see if this is an option.
Additional Resources
- Nolo: Claiming Pensions and Other Benefits After Someone Dies
- Internal Revenue Service: Retirement Topics – Death
- Social Security Administration: Survivors
- Department of Veterans Affairs: Benefits for Survivors of Deceased Veterans
Disclaimer
This guide is for informational purposes only and should not be considered legal advice. You should always consult with an attorney or other qualified professional for legal advice.
Types of Pensions
Defined-benefit and defined contribution pension plans are the two primary categories.
- Typically, defined-benefit plans are thought of as “pensions.” Employee benefits are calculated using a formula that takes into account a number of factors, including length of employment and salary history, in this employer-sponsored retirement plan. It is known as a “defined benefit” because employers and employees use the same formula to determine the amount of benefits to be paid out in retirement. Usually, the employer finances the plan by making a regular contribution into a tax-deferred account, typically equal to a portion of the employees’ pay. Depending on the plan, employees may also make contributions.
- A defined contribution plan, such as a 403(b) or 401(k), is a tax-deferred retirement plan where employees contribute a portion of their paychecks, or a fixed amount, to an account that is meant to fund their retirement. As an extra perk, the sponsoring company occasionally matches a percentage of employee contributions. These plans impose limitations on the amount and timing of each employee’s penalty-free withdrawals from these accounts. A defined-benefit plan, not a defined contribution plan, is typically referred to as a “pension.”
Types of Survivor Annuity Options
The primary thing to take into account with a defined-benefit plan is whether the member was retired at the time of death. The plan may give the designated beneficiary a lump sum payout if the member had not retired before passing away.
Usually, this is worth a multiple of the member’s salary because defined-benefit plans were intended to be correlated with the employee’s employment history and length of service.
If the member had already retired, their benefits would either cease upon their passing (known as a single-life pension) or they would continue, albeit at a reduced rate, to a beneficiary (known as a joint-life or survivor pension)
The conventional method of retirement planning, defined-benefit plans, gradually lost ground to defined contribution plans.
The member’s monthly payments would be greater if they chose a single-life pension than a joint-life pension.
Joint-life options typically have lower payments to the member during their lifetime and the survivor beneficiary because the employer anticipates having to pay benefits over a longer period of time.
Other hybrid options might also be available, with significantly lower payments to the surviving beneficiary and higher payments to the member until death (though not as high as the single-life option).