Majority of savers unsure what happens to their pension when they die

More than 26 million pension savers are unsure what would happen to their pension or who would receive it in the event of their death, research from the Money and Pensions Service (Maps) has suggested.

The survey, which gathered views from 2,561 UK adults with a pension, found that just under half (41 per cent) of savers correctly said that their pension would go to their nominated beneficiary in the event of their death.

However, just over a fifth (23 per cent) of all those surveyed incorrectly believed it would go to their next of kin automatically, while 11 per cent said they didn’t know.

In addition to this, 11 per cent thought it would go to the government, while 8 per cent thought it would go to their employer and 7 per cent thought it would go to their pension provider.

Even amongst those who had taken steps to nominate a beneficiary, the survey found that one in five (20 per cent) didn’t know who they had nominated to receive any of their pensions.

In addition to this, nearly half (47 per cent) knew who they’d picked for all of them, yet 11 per cent said they only knew for “most” and 10 per cent said they did for “some”.

The findings were realised to coincide with this year’s Talk Money Week, run by Maps, which is aiming to inspire people to “do one thing” that improves their financial wellbeing.

In light of the survey results, Maps has this year asked everyone with a pension to check their beneficiary to make sure they’ve named the people they want to receive it.

Maps also stressed the importance of keeping pension details up to date more broadly, as the survey found that a number of savers had failed to keep their contact details up to date.

According to the survey, 77 per cent of pension savers had kept their name up to date, while 75 per cent had updated their address, and 74 per cent had updated their email address for at least some of their pensions.

Commenting on the findings, Maps head of pensions policy, Jackie Spencer, said: “It’s a difficult topic to think about and no one expects the worst to happen to them, but it’s absolutely crucial that we make plans in case it does.

“People come in and out of our lives and if you have someone you no longer want as your beneficiary, they could end up benefitting at the expense of the loved ones you’ve left behind. These results suggest millions of people are running that risk.

“This Talk Money Week, we’re asking everyone to do one thing and check they have the right beneficiary for each and every pension they hold. This can be done by contacting your pension provider by phone or online and it’ll make all the difference if you pass away early.

“There is free, impartial guidance on what to do and why via our MoneyHelper service and we’re here for anyone who needs us.”

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