What happens if a member of a pension dies very soon after he retires? Will the pension system keep all the money it would have paid out to him?

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Posted 9 years ago

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Official Response
What happens after a retiree dies depends on the retirement options he chooses. At retirement, a retiree has to choose (A) whether to receive the maximum benefit, or (B) whether to take an option that would provide a benefit to a designated beneficiary in case of death of the primary retiree, and would reduce the retirement benefit amount.
If a retiree chooses to receive the maximum benefit, payments will cease on the death of the retiree.

If the retiree chooses an option, for example, a 100% joint and survivor option, a
popular choice, the designated beneficiary would receive an equal lifetime benefit if the primary retiree dies. There are several types of options available and they vary by pension plan. The amount of reduction in benefit depends on the option chosen as well as, in most cases, on the ages of the pensioner and the beneficiary.

For information regarding benefits administered by the New York City
Employees' Retirement System (NYCERS), please contact NYCERS' Call
Center at (347) 643-3000 or visit www.nycers.org.

For information regarding benefits administered by the Teachers' Retirement System (TRS) visit TRS’ website at www.trsnyc.org or contact TRS’ Member Services Center at 1 (888) 8-NYC-TRS.