Jump to content

Post Death retirement benefit


Recommended Posts

Seeking advice....my father retired two years ago and start receiving his pension from a labor union, which is 100 percent funded by employers. I am the only child, he is single, and I was left with a large burial bill, property taxes, and other estate bills. I discovered he changed his beneficiary on his pension to a friend, who will start collecting his monthly pension. Is there anything I can do at this point to receive his pension? Override the beneficiary or Obtain a DRO to assist with the expenses? 

Link to comment
Share on other sites

My condolences for your loss.  Normally, the plan is the only vehicle for defining both the benefit and any (potential) beneficiary.  For example, most plans, if no beneficiary is specified, will include a sequence of others to define a beneficiary (such as: first children, then parents, then siblings, etc).  This may not apply in your case. 

If you have not done so, ask the Plan Administrator (which might be contacted thru the HR department of the company) to explain the beneficiary situation to you.  To my ear, having a "friend" defined as the beneficiary is very unusual, so there might be more relevant facts. 

I'm unsure about your phrase "override the beneficiary", but an estate lawyer may tell you that would be possible only if you can prove fraud or some other incorrect application of the plan rules.  At least for me, it's not obvious whether you would have any standing to submit a DRO.  BTW, the lawyer may also tell you that the "estate bills" are the responsibility of the estate, not you.  (I'm not a lawyer.)

I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.

Link to comment
Share on other sites

I spoke to the Plan Administrator and she can not provide me any information. I think it is because I'm not the beneficiary. I only know that I'm not because the friend is calling and asking me for my dad's birth certificate and death certificate for the pension. She seems to be getting information from the plan administrator, so I assume she is the beneficiary and she said she was. I am very stressed, as I have to figure out a way to pay the funeral home. Btw, you stated the estate is responsible for his bills. Since, I am his only child and the property is being switched over to me, doesn't that mean I'm responsible?

Link to comment
Share on other sites

I replied to your other post, and continue to not be a lawyer.  I would expect that the estate is responsible for the bills, not you.  If the estate has any value, the bills could be paid from the estate (including the funeral home charges if not paid - if already paid, you could seek reimbursement from the estate).  If the estate hasn't got a sufficient value to cover outstanding debts, you should bear no responsibility personally to pay them.  If the property is not mortgaged to full value, you may be able to take a loan on it to pay off, for the estate, the outstanding debts.  If the property is fully mortgaged and you wanted to maintain possession of the property, you would use personal assets to pay the taxes.  The other creditors can, perhaps, be permanently denied payment unless the property was used as collateral for the debts without it costing you ownership of the property.  Local laws may extinguish debts upon the death of the debtor.  There may have even been some sort of insurance in connection with the mortgage eliminating the mortgage debt.  See a lawyer.

Always check with your actuary first!

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...