What happens to your super when you die isn't something most people consider.
Despite worrying about how long super will last, some people will actually die before their superannuation is used for its intended purposes – an income in retirement. While this isn't something most people like to consider, it’s important to ensure that those who need it most are the ones who will benefit from your superannuation once you die.
When you first opened your superannuation account, you would most likely have been asked to nominate a super beneficiary, however, this isn't the case in all instances. If you did make a nomination, you would have done so through one of the three methods below:
Revisionary nomination – whereby you nominate someone to receive the balance of your account as a regular income.
Binding nomination – whereby you formally write to your superannuation fund to advise who should receive your account balance. Your nomination, once validated, is binding.
Preferred non-binding nomination – whereby you advise your super fund who you would like to receive your account balance in the event of your death. While your wishes are given due consideration, it is not a legally-binding nomination.
Of course, it’s worth noting that the person you nominated when you first opened your superannuation account may no longer be the person you would like to receive your account balance if you die. Therefore, it is important to consider if your nomination needs to be reviewed. You can nominate:
- a spouse – whether de facto or same-sex
- children of any age – adopted and stepchildren can be included
- interdependants – a person with whom you have a close personal relationship, share a residence and where either of you provides financial and domestic support, and personal care for the other
- a financial dependant – someone who relies upon you financially
- a personal legal representative – stated in your will as being the executor of your estate
If you’re planning on leaving the balance of your superannuation account to your children, who are aged between 18 and 25, and are financially dependent on you, then they can receive your balance as regular amounts. This can continue until they reach 25 or your account balance runs out.
Once they turn 25, the remainder of your account balance will be paid as a lump sum.
Regardless of their age, a permanently disabled child can continue to receive regular payments until the money runs out.
To find out more about how you can ensure your super benefits those you wish, visit Australiansuper.com
This article has been sponsored by AustralianSuper Pty Ltd ABN 94 006 457 987, AFSL 233788, Trustee of AustralianSuper ABN 65 714 394 898. The views expressed are those of YourLifeChoices and not AustralianSuper. For more information about AustralianSuper, please visit australiansuper.com
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