When a Partner Dies: What AHV, the Pension Fund and Inheritance Law Set in Motion
The death of a partner changes a household's finances in a dozen places at once: pensions disappear or newly begin, matrimonial property and inheritance law divide up the assets, taxes are recalculated. A sober look at a chain worth understanding once – beforehand.
Few events cut as deep into a household's finances as the death of a partner – and few are worked through as rarely. Yet the mechanics are not fate, but a chain of clearly defined steps. Anyone who understands them can close gaps while there is still time to do so.
First pillar: survivors' pensions – with conditions
AHV (the state pension) pays widow's and widower's pensions, plus orphan's pensions for the children. Entitlement depends on conditions – such as children or a minimum length of marriage – and differs by situation. Anyone already at pension age experiences a different effect: the cap on the combined pension for married couples falls away, their own old-age pension is recalculated, and a widow's/widower's supplement is added. Even so, the household ends up with less than the two pensions it had before – while housing costs barely fall.
Second pillar: what the fund regulations provide
The pension fund pays the surviving spouse a partner's pension – defined as a minimum in law, often set more generously in the fund's own regulations. If the insured person dies before retirement, a lump-sum death benefit also comes into play. What exactly is paid out is not fixed by law but by the fund's regulations – and varies considerably from fund to fund. Pillar 3a balances, too, are paid out according to a fixed order of beneficiaries.
Matrimonial property law before inheritance law
For the assets, the settlement happens in two stages: first the property regime is dissolved – the surviving spouse receives their Eigengut (separate property) and their share of the Errungenschaft (marital acquisitions). Only what remains after that becomes the estate, which is distributed under inheritance law: to the spouse and the children according to statutory shares, unless a will provides otherwise. For the surviving partner, this interplay decides whether the assets stay together or have to be divided – in the most difficult case, that is precisely the shared house.
Taxes and affordability: the second wave
After the immediate consequences comes the second wave. Taxes are reassessed – from the married-couple rate to the single rate, with one income instead of two. The bank recalculates the affordability of the mortgage using the remaining income. And the long-term plan – drawing down assets, retirement age, housing situation – simply no longer holds in its old form.
Calculate beforehand, not afterwards
Each of these pieces is documented on its own; what is usually missing is how they interact: what is left for the surviving partner in the end – per year, over decades? In Wealth4Life, death is a scenario like any other: the model works through survivors' pensions, the division under matrimonial property and inheritance law, taxes and affordability, and shows the trajectory that follows. Not to dwell on the scenario – but so that any gap becomes visible today, while a will, a beneficiary designation or insurance can still change something about it.