Elsie, from Stowmarket, writes: "My husband died recently aged 74. He and I were both receiving state pensions and he had a company pension from Marks and Spencer.
"Will I be entitled to the Widow's Payment lump sum and will I receive any extra pension payments from the state pension scheme or from Marks and Spencer?
"He also had around £40,000 in PEPs and ISAs. What happens to those investments?"
What used to be known as the Widow's Payment and Widow's Pension have now been replaced by the Bereavement Payment and Bereavement Benefit.
Unfortunately, neither of these benefits will be available to you as both you and your husband were drawing a state pension at the time of his death.
However, if your husband was receiving any pension benefits from the former State Earnings Related Pension Scheme, (Serps), in addition to his basic state pension, you will be entitled to additional pension payments ongoing.
As your husband was born before October 5, 1937, you will be entitled to 100 per cent of any Serps pension benefits he was receiving.
In addition, if he was receiving any payments from the old graduated pension scheme, you will also receive 50 per cent of these payments ongoing.
These benefits (if applicable) will be paid in addition to your own state pension.
Marks and Spencer has confirmed that you will be entitled to a pension of 50 per cent of what your husband was receiving, for the remainder of your lifetime.
As his sole beneficiary, you will inherit your husband's PEPs and ISAs. The tax-free PEP and ISA wrappers will disappear as a result of his death, but with most fund managers you will have the choice of taking the cash from these investments or moving the funds across into Unit Trusts or OEICs in your name.
If you have not used your own ISA allowance in this tax-year, you will be able to re-invest £7,000 of the funds into an ISA in your name.
You can do this each tax-year until all the money is moved back into tax-free ISA wrappers.
Contacting NickNick Plumb is an independent financial adviser. Send your questions to Nick at Bright Financial Planning, 58 Station Road, Sudbury, Suffolk, CO10 2SP, email them to
nickplumb@aol.com or telephone Nick on 01449 675674.
Nick's answers to reader questions in this column are provided only as a general guide and do not constitute personal financial advice. For any readers requiring specific advice on their own circumstances, Nick is happy to offer a complimentary initial meeting.
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