Workers not making pension provisions for partners
A quarter (25%) of respondents said that their partner has no pension of their own
An increasing number of people are not making any provision for their pension payments to continue to their partners in the event of their death, according to research from Aegon.
While 75% of people aged 75 and above have made pension provisions for a spouse, this falls to only 47% of those aged 45 to 54, suggesting a generational shift away from such practices.
Half (49%) of men have made some provision for their partners but only a third (31%) of women have done the same. A quarter (25%) of respondents said their partner has no pension of their own.
Kate Smith, head of pensions at Aegon, explained that the reason the majority of those over 75 have pension provisions for a spouse is probably down to common practice in defined benefit schemes, meaning this generation did not have to make a conscious decision to include spouses.
“Historically, company defined benefit and state pension payments would continue to a partner on the death of the individual,” she said. “However, with the shift away from defined benefit and with changes to state pensions meaning a partner will no longer receive a survivor pension, these findings suggesting younger and future generations of retirees are less likely to provide for their spouse are worrying.
“The closer you get to retirement the more you need to begin to plan your retirement finances in tandem," she added.
Smith drew attention to the difference between the percentages of men and women making provisions for their partners. “This is traditionally more of a problem for women, who on average live longer and may have been more reliant on a husband for pension income or who have been unable to build up an adequate pension for themselves due to time out to care for children or elderly relatives,” she said.
“While these societal trends may change over time it’s important that couples begin planning retirement finances together rather than in isolation.”