Written by Adrian Seager
Ward Goodman
July 14, 2025
When it comes to retirement planning, many people focus on how much they’ll need to live comfortably in later life. But there’s another critical question that often gets overlooked: what happens to your pension savings when you die?
Recent research found that one in six people in the UK with a partner don’t know who will inherit their pension if they pass away before accessing it [1]. Among the Silent Generation (those aged 79 and older), that figure rises to nearly one in five [1]. This lack of clarity can cause unnecessary financial and emotional complications for loved ones.
Why your pension beneficiary matters
Unlike other assets, pensions are not usually covered by your Will. Instead, they rely on a nomination of beneficiary – a separate instruction given directly to your pension provider. While not legally binding, pension providers strongly consider your nomination when deciding how to distribute your pension. Yet despite the simplicity of this process, many people forget to keep their nomination up to date.
Surprisingly:
- 3% of individuals believe their pension is still nominated to an ex-partner
- 65% have correctly nominated their current spouse or partner
- Others have chosen children, charities, or close friends
If your circumstances change and you don’t update the details, your pension could end up in the wrong hands – potentially causing avoidable disputes or delays.
Relationship status plays a big role
If you’re unmarried but living with a partner, the risk is even higher. Research shows that 25% of people in this situation don’t know who their pension is currently nominated to [1]. A quarter of people in this situation are unsure who their pension is currently nominated to [1]. Because unmarried partners are not automatically recognised as next of kin, an outdated or missing nomination could mean they receive nothing.
Younger adults are also at risk
Nearly a third of 16 to 24-year-olds admitted they don’t know who would receive their pension [1]. This is often due to workplace pension auto-enrolment, where nominations may not be discussed at all. But no matter your age, reviewing your nominations is a good habit to get into, especially after major life events such as marriage, divorce, having children or changing jobs.
What happens if you don’t nominate anyone?
If your pension provider doesn’t have a clear instruction, they will usually use their discretion to decide where the funds should go. While they may try to identify the most appropriate recipient, this process can take time and place additional strain on your loved ones during an already difficult period.
It’s also worth noting the tax advantages pensions can offer. If you die before the age of 75, your beneficiaries can typically receive the pension tax-free. After 75, the money may still be passed on, but taxed at the recipient’s marginal rate. Without a nomination in place, this valuable opportunity could be lost.
What’s the difference between a beneficiary and a nominee?
When planning your pension inheritance, it’s helpful to understand the terms often used interchangeably – beneficiary and nominee.
- A nominee is the person you designate to receive your pension benefits in the event of your death. This is typically done by completing a nomination form with your pension provider.
- A beneficiary is the person or entity who actually receives the pension funds. While this often matches the nominee, your pension provider has the final say based on the circumstances and available evidence.
Keeping your nominee information up to date increases the likelihood that your intended beneficiary will receive your pension without unnecessary delays.
How to check and update your pension beneficiaries
Fortunately, updating your nomination is usually quick and straightforward. Most pension providers let you log in online to review or amend your details, or you can request a paper form. A few minutes of admin now could save your family months of stress later.
Key reminders:
- Review your nominations annually or after any major life event
- Make sure each pension pot is updated individually
- Don’t assume your Will overrides your pension – it doesn’t
Take control of your pension legacy
Your pension may be one of the most valuable assets you own. Ensuring it goes to the right person is a key part of your financial planning.
If you’re unsure who’s nominated, need guidance or want to make sure your pensions reflect your current wishes – the team at Ward Goodman is here to help.
Contact us today to speak with our expert team and protect your family’s financial future.
For more details on how we can help with retirement and pension planning, visit our Pension & Retirement Planning page.
Source data:
[1] The research was conducted by Censuswide among a sample of 2,000 general consumers who have a partner, whether married, in a relationship or a civil partnership. The data was collected between 07/02/25 and 10/02/25.
