It may come as a surprise that you don’t actually “own” your superannuation. In reality, the trustee of the Superannuation Fund legally owns your superannuation and your superannuation is held on trust until you or someone else becomes legally entitled to it.
What this means for your estate planning is that your superannuation and any insurance benefits that comes from your Superannuation Fund do not automatically form part of your Estate if you die.
In the absence of valid Binding Death Benefit Nomination the trustee of the Superannuation Fund makes the decision as to where your superannuation and any insurance benefits are paid. There are of course strict rules about where that might be, however, the trustee’s decision is discretionary and may not achieve the best outcome for either your Estate or your beneficiaries, or alternatively, may not be what you would have wanted to occur.
As part of any estate plan, due consideration and careful planning is needed to ensure that your superannuation benefit is paid, firstly, how you intended for it to be paid, and secondly, in a manner that works advantageously to your chosen beneficiaries.
The best way forward will depend on many things including:
Once the above have been carefully considered, your decision is then documented and enforced through a valid Binding Death Benefit Nomination. A Binding Death Benefit Nomination is in essence a document that complies with both the rules of the Superannuation Fund and the superannuation laws and legally binds the trustee of the Superannuation Fund into distributing your superannuation death benefit in the manner you have prescribed.
A valid Binding Death Benefit Nomination generally needs to be:
Most Binding Death Benefit Nominations often lapse after 3 years, so it is important to ensure that you regularly review your Estate Plan.
As part of providing strategic advice, we will discuss your Binding Death Benefit Nomination or Nominations with you and advise you based on your circumstances on the best course of action to take for your individual estate plan.
Having a valid Binding Death Benefit Nomination will ensure that your superannuation goes where you want it to go and give you and your beneficiaries certainty.
To discuss an estate plan for your individual circumstances, please contact Robert Lamb, Anna Huang or Tracy Pratt from our Wills, Estates & Trusts team for a free initial consultation on (07) 3220 1144 or email.
The information in this blog is intended only to provide a general overview and has not been prepared with a view to any particular situation or set of circumstances. It is not intended to be comprehensive nor does it constitute legal advice. While we attempt to ensure the information is current and accurate we do not guarantee its currency and accuracy. You should seek legal or other professional advice before acting or relying on any of the information in this blog as it may not be appropriate for your individual circumstances.
The information in this blog is intended only to provide a general overview and has not been prepared with a view to any particular situation or set of circumstances. It is not intended to be comprehensive nor does it constitute legal advice. While we attempt to ensure the information is current and accurate we do not guarantee its currency and accuracy. You should seek legal or other professional advice before acting or relying on any of the information in this blog as it may not be appropriate for your individual circumstances.