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Tuesday, June 19, 2007

Girl They Won't Believe

Really a woman, but it doesn't really matter.  I spent more than an hour on the phone yesterday afternoon with a woman whose husband - an active Tier 1 PERS member and PSU colleague - had died unexpectedly in his early 60's.   Her story is most perplexing and qualifies as one of the more difficult issues I've heard about in quite some time.  She's been dealing with PERS' death unit for several months and has, thusfar, been unsuccessful in prying any money from them.  The issue hinges on PERS' belief that her husband died without officially naming her as a beneficiary.  Leaving aside the question of whether he did or didn't officially name his wife as a beneficiary, it has always been my understanding that one's spouse is always the beneficiary unless an individual is (1) unmarried at the time of death or retirement or (2) explicitly declaims the spouse *and the spouse agrees in writing to the declamation*.  Otherwise, the spouse is the default beneficiary.  According to PERS, in the absence of an official beneficiary form, the only way the spouse can recover benefits from the account of a deceased non-retiree is via probate of the will.  Since the husband was very careful to put all property in both of their names, had explicitly named his wife as the beneficiary of the IAP account, had a current will naming his wife as personal representative and recipient of his entire estate, how likely is it that he *forgot* to name his wife as the beneficiary of his Tier 1 account?  I find this nearly impossible to believe.  So, she's left arguing with PERS that they've misplaced the relevant information, while PERS claims that they don't have it.  She's left to pursue probating a will that otherwise doesn't require probate (and the legal fees involved), or she can enlist the aid of a lawyer to sue PERS.  The challenge is that few people ever get a copy of the information PERS receives when it enters a new member into the system and so many people may be unaware of the beneficiary status of their PERS account.  I'm hopeful that this can be resolved favorably and quickly.  I've certainly pointed her in a direction that will, if at all possible, lead to a quick resolution.  (Answer to obvious question:  wife and husband married a very long time.  Husband began work at PSU long after he and his wife married).

The moral of this story is that if you are an active PERS member, make sure you have a named beneficiary attached to your PERS account.  Don't make any assumptions.  If you are in doubt, fill out another form to make double-dog sure you're covered.  

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