Is superannuation included in your will?

For many, superannuation is an investment that has compounded over their entire career. For this reason, it can represent a substantial sum and it is important that you control who receives the benefit of your superannuation in the event of your passing.

When superannuation is paid after a person has passed away, it is referred to as a Superannuation Death Benefit. Superannuation Death Benefits do not form part of your estate. Your superannuation is held in trust and managed by the trustee of the superannuation fund, and you must nominate the person who is to receive the benefit of your superannuation.

A Death Benefit Nomination is used to nominate one or more dependents (e.g. spouse or child) or your legal personal representative (the executor or administrator of your estate in accordance with your will) to receive your Superannuation Death Benefit. Your nomination may be binding or non-binding, which may also be referred to as non-lapsing and lapsing and it is important to understand the differences and the implications this may have on your Superannuation Death Benefit.

If you nominate your legal personal representative, your Superannuation Death Benefit will form part of your estate and be distributed in accordance with your will. Otherwise, your Superannuation Death Benefit will be paid by the trustee to your nominated dependent as either a lump sum or income stream if eligible. It is recommended that financial advice is sought in relation to any Superannuation Death Benefit.

One key takeaway is to review your own superannuation to ensure that you have a valid and current nomination. It is also important to ensure you regularly review your nomination to ensure it reflects your current wishes. If you were to pass away without a current nomination, the trustee of your superannuation fund may use their discretion to pay your Superannuation Death Benefit to one or more of your dependents or your legal personal representative.

If you require assistance with estate planning, contact the experienced team at Baker Love Lawyers.

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