Nomination of beneficiaries / expression of wishes

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What is an Expression of Wish?

An Expression of Wish (sometimes called a Nomination of Beneficiaries) is a way to tell your pension provider who you’d like to receive your pension benefits if you die.

Think of it as a letter of instruction that sits alongside your pension, helping pension trustees make decisions about who should receive your hard-earned savings when you’re no longer here.

Why Your Will Might Not Be Enough for Your Pension

Many people assume that their Will covers everything they own, including their pension. This is one of the biggest misconceptions about pension planning, and it can have serious consequences.

Here’s the reality: Your pension typically doesn’t form part of your estate and isn’t controlled by your Will. This means that even if you’ve written a detailed Will, your pension might still go to someone you didn’t intend if you haven’t completed an Expression of Wish form.

Let’s look at an example:

James made a Will leaving everything to his current partner Emma but never updated the Expression of Wish form for his workplace pension, which still named his ex-wife Sarah as the beneficiary. When James died unexpectedly, the pension trustees had to consider his outdated Expression of Wish form, creating unnecessary stress for Emma during an already difficult time.

The Crucial Difference: Pension Trustees vs. Will Executors

Understanding who’s in charge of what after you die is important.

Will Executors are the people you appoint to carry out the instructions in your Will. They distribute the assets that form part of your estate.

Pension Trustees are responsible for your pension scheme and have a legal duty to decide who receives your pension benefits when you die. They are separate from your Will executors and follow different rules.

While Will executors must follow the instructions in your Will, pension trustees have something called “discretion” – they can make the final decision about who receives your pension benefits. Your Expression of Wish form guides them, but they’re not legally bound to follow it in all cases.

Why Completing a Nomination Form is Essential

Given what we’ve just explained, here’s why completing an Expression of Wish is so important:

• It guides the pension trustees in making decisions that align with your wishes

• It speeds up the payment process after your death, getting money to your loved ones when they might need it most

• It helps avoid confusion and potential disputes between family members

• It ensures your current wishes are known, especially if your circumstances have changed since joining the pension scheme

• You can update it as your circumstances change, ensuring your wishes stay up to date

Without an Expression of Wish, trustees might have to make decisions based on limited information, which could mean your pension doesn’t go to the people you would have chosen.

Peace of Mind: Ensuring Your Loved Ones Are Provided For

Completing an Expression of Wish form gives you peace of mind that you’ve done everything possible to ensure your pension benefits will support the people you care about most after you’re gone.
Many pension schemes offer valuable death benefits, which might include:

• A lump sum death benefit

• A survivor’s pension for your spouse or partner

• Pensions for dependent children

By clearly documenting your wishes, you’re taking an important step in your overall financial planning, helping to protect your loved ones’ financial future.

Keeping Your Nomination Form Up to Date: Avoiding Unintended Consequences

Life changes, and your Expression of Wish form should reflect those changes. It’s not a “set it and forget it” document.

You should review and potentially update your Expression of Wish form after:

• Getting married or entering a civil partnership

• Getting divorced or separating from a partner

• Having children or grandchildren

• The death of a previously nominated beneficiary

• Any other significant change in your family or financial circumstances

Many people complete an Expression of Wish form when they first join a pension scheme and then forget about it. Years or even decades later, their personal circumstances may have changed dramatically, but their outdated form still reflects their old wishes.

Separation and Divorce: Protecting Your Intended Beneficiaries

Divorce or separation is a particularly important time to update your Expression of Wish form. Unless you specify otherwise, your ex-partner could still be entitled to receive your pension benefits if they remain named on an outdated form.

While a divorce settlement might deal with the pension’s value during the marriage, it typically doesn’t automatically change who receives death benefits. That’s why it’s essential to review your Expression of Wish form after a relationship ends.

Naming Minor Children as Beneficiaries: What You Need to Know

If you want to name children under 18 as beneficiaries, there are some important considerations:

• Minor children cannot directly receive pension lump sums

• You might want to consider nominating a trustee to manage the funds until the children reach adulthood

• Some pension schemes offer the option to set up a trust as part of your Expression of Wish

When nominating children, it’s particularly important to be specific about who you mean, especially in blended families where there might be step-children or children from previous relationships.

Can You Nominate a Charity as a Beneficiary?

Yes, you can typically nominate a charity to receive all or part of your pension benefits. This can be a way to support causes you care about and might have tax advantages. When nominating a charity:

• Include the charity’s full name

• Add their registered charity number if possible

• Specify what percentage or amount you’d like them to receive

If charitable giving is important to you, discussing this with a financial advisor can help ensure your philanthropy is structured effectively.

What Happens if You Don't Complete a Nomination Form?

If you don’t complete an Expression of Wish form, the pension trustees will still need to decide who receives your pension benefits. They’ll typically:

1. Look for any eligible dependents (spouse, civil partner, financially dependent individuals)

2. Consider other family members

3. Make payments to your estate if no eligible beneficiaries are found

4. They may look at your will
This process:

• Usually takes longer than when a valid form is in place

• Might result in benefits going to people you wouldn’t have chosen

• Could cause additional stress and uncertainty for your loved ones during an already difficult time

When Might a Pension Trustee Override Your Wishes?

While pension trustees give serious consideration to your Expression of Wish form, there are circumstances where they might decide to distribute benefits differently:

• If your form is significantly outdated and doesn’t reflect your current family situation

• If there are dependents (like a spouse or children) who aren’t included in your form but who were financially dependent on you

• If there’s clear evidence that you intended to update your form but didn’t get the chance

Trustees have a legal duty to consider all relevant factors and make fair decisions. This discretion is actually a safeguard that allows them to respond to complex family situations or changes in circumstances.

It is very rare that expressions of wish get overturned and so keeping your expression of wish updated is a relatively quick piece of life admin that gives the best chance of your wishes being carried out. Remember that if this is being used, you’re not around to make the argument either way.

The Trustee's Duty of Care: Balancing Your Wishes with Beneficiary Needs

Pension trustees have a duty to:

• Act in the best interests of the scheme’s beneficiaries

• Consider all relevant information when making decisions

• Make fair and impartial decisions

This means they need to balance your stated wishes with the needs of potential beneficiaries and the specific circumstances at the time of your death.

Having a clear, up-to-date Expression of Wish form makes the trustees’ job easier and increases the likelihood that your pension will be distributed according to your wishes.

What Information Do Trustees Consider?

When deciding who should receive your pension benefits, trustees typically look at:

• Your Expression of Wish form

• Your family and financial circumstances at the time of your death

• Any dependents and their financial needs

• Any other relevant information about your wishes (though this is harder to verify without an up-to-date form)
This is why keeping your form current is so important – it ensures trustees have accurate information when making these crucial decisions.

How to Obtain and Complete a Nomination Form

Getting and completing an Expression of Wish form is straightforward:

1. Find and request the form – You can usually access these through:

o Your pension provider’s website
o Your online pension account or customer portal
o By calling or emailing your pension provider’s customer service
o Your employer’s HR department (for workplace pensions)
o Your financial advisor, who can help you obtain and complete the form

2. Complete the form with the necessary information:

o Your personal details (name, address, date of birth, National Insurance number)
o Your pension scheme details or policy number
o Details of your chosen beneficiaries (names, addresses, dates of birth, relationship to you)
o How you want to divide the benefits (percentages)

3. Submit the form according to your provider’s instructions

4. Keep a copy for your own records

5. Inform your loved ones that you’ve completed the form and where they can find your copy

Remember that different providers may have slightly different forms and requirements, so follow the specific instructions for your scheme. And if you have multiple pensions, you’ll need to complete a separate form for each one.

How Often Should You Review and Update Your Form?

As a general rule, you should review your Expression of Wish form:

• Every few years, even if nothing significant has changed

• After any major life event (marriage, divorce, birth of children, death of a beneficiary)

• When you approach retirement

• If there are significant changes to pension or inheritance laws

Making this review part of your regular financial planning – perhaps alongside checking your Will – helps ensure your wishes remain current.

Can You Name Multiple Beneficiaries and Specify Percentages?

Yes, most Expression of Wish forms allow you to:

• Name multiple people and/or organizations
• Specify exactly what percentage each should receive
• Name backup (contingent) beneficiaries in case your first choices predecease you

For example, you might choose to allocate:

• 50% to your spouse
• 25% to each of your two children
• If any of them predeceases you, their share to be divided among the survivors

This flexibility allows you to tailor your wishes to your exact family situation.

Common Questions About Pension Beneficiaries

Can I change my Expression of Wish form at any time?

Yes, you can update your form whenever you wish. There’s no limit to how often you can change it.

Is an Expression of Wish form legally binding?

No, it’s not legally binding in the same way as a Will. It guides the pension trustees, who have the final discretion over who receives your pension benefits.

Can an Expression of Wish form be contested?

While the form itself can’t be contested like a Will, potential beneficiaries can make representations to the pension trustees if they believe they should be considered.

What's the difference between Expression of Wish and Nomination of Benefits?

These terms are often used interchangeably, though some pension providers might use one term or the other. They refer to the same process of indicating who you’d like to receive your pension benefits.

Will my pension beneficiaries have to pay tax on what they receive?

The tax treatment depends on several factors, including your age when you die and how the benefits are taken. This is an area where professional financial advice is particularly valuable.

The Importance of Seeking Professional Financial Advice

While completing an Expression of Wish form is relatively straightforward, the decisions about who to nominate and how to divide your pension benefits can be complex.

A professional financial adviser can help you:

• Understand the specific rules of your pension scheme

• Ensure your Expression of Wish aligns with your overall estate planning

• Consider the tax implications of different approaches

• Navigate complex family situations

• Create a coordinated approach across all your pensions and other assets
Their expertise can help you make informed decisions that best protect your loved ones.

Taking Action: Next Steps to Protect Your Loved Ones

Your pension is likely one of your most valuable assets, and ensuring it goes to the right people when you die is an important part of financial planning. Here’s what you should do now:

1. Check if you’ve completed an Expression of Wish form for each of your pensions

2. Request forms for any pensions where you haven’t completed one

3. Update any outdated forms that don’t reflect your current wishes

4. Keep copies of all your completed forms with your important documents

5. Tell your loved ones about your pensions and where to find information about them

By taking these simple steps, you can have peace of mind that you’ve done everything possible to ensure your pension benefits will support the people who matter most to you.

Need help ensuring your pension will go to the right people? Our independent financial advisors can help you navigate the Expression of Wish process and make sure it aligns with your overall financial plan. Contact us today for a no-obligation conversation about protecting your loved ones’ financial future.