Every month when you get paid, it's likely a percentage of your money goes into your pension pot. With a bit of luck, your employer will be chipping in some money too, and there's also the tax-relief you get from the government.
All of this helps you build up a pot of money over your working life. You can then use that money during your retirement, where as a lump sum or to buy an annuity.
But what happens if you don't get to tap into the money in your pension? As awful as it is to think about, there's a possibility that you could die before you have a chance to use your pension. So, what would then happen to all the money in your pension savings?
Your pension is part of your assets…
The money in your pension pot is one of your assets, just like your savings or your possessions. That means the money could go to your loved ones in one big lump sum.
But which one of your loved ones would get it? In today’s world of often complicated family situations, can you be sure the money in your pension would end up where you’d want it to go?
The answer is yes, you can, but only if you tell us who you’d like us to pay the money to if the situation arises. That’s where nominating a beneficiary comes into play.
Make sure it goes to the right person
It’s easy to nominate a beneficiary. Most of the time, you can do it online without any fuss.
You can ask your pension provider to pay the money to a particular person. Your provider isn’t legally bound by your request, but they will definitely take it into account when they’re sorting out your pension.
You can also change your beneficiary at any time if your circumstances change.
Adding a beneficiary for your pension could provide peace of mind
Whatever the size of your pension, it's money that belongs to you, so it's important to make sure you've made plans for it in case something happens, and you can't benefit from that money, but you would like it to be shared with your loved ones.
We strongly recommend you check with your pension provider whether you have a nominated beneficiary in place. If you haven’t, it’s worth adding one. It will only take a few minutes, and it could give lasting peace of mind to you and your loved ones.