This article is reprinted by permission from NextAvenue.org. At least once a month, a recently bereaved adult child calls John Joseph (J.J.) Conway, principal and founder at J.J. Conway Law in Royal Oak, Michigan, inquiring about how to obtain their deceased parent’s pension. Unfortunately, he rarely has good news.
“Pensions are their own entities with their own written rules, much like contracts,” explains Conway, a specialist in the Employee Retirement Income Security Act. “Pensions are also expensive, and owing to strict federal funding requirements, can cut into a company’s balance sheet.” For these reasons, children can rarely inherit a deceased parent’s pension. But that’s not an absolute “no.” So, under what circumstances can you inherit a deceased parent’s pension — and what other retirement benefits might you be able to inherit? Also on MarketWatch: My mother’s will leaves everything to her 3 children. My brother died suddenly — and his wife says she will receive her late husband’s shareInheriting your parent’s pension The answer to the question of whether you can inherit your parent’s pension depends on which plan and which payout option your parents chose when they signed up to participate in the plan, says Matthew Koppelman, financial planner at Prudential in Bethesda, Maryland. A “single-life” option is straightforward: monthly pension payments equal to a fraction of the employee’s highest or most recent annual salary b …
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