Who gets your super when you're gone?

Who gets your super when you are gone?

Over your working life you will likely accumulate a substantial super balance and like many Australians, it may become one of your biggest assets. Just as you would specify the person you want to receive your other assets, you need to let your super fund know who you would like your super to go to.

In a continuation of  Child Care Super super savvy information series, Claire, our Financial Best Friend - FBF, recently caught up with Mark to talk about what he is planning to do with his super after his death and the importance of nominating a beneficiary and letting  Child Care Super know who this is.

Claire: Planning for what happens after you're gone may seem a bit hard, but it’s important to be aware of your options and understand what happens to your super when you die.

Mark: I agree, but I’ve always been quite well planned and think that 2020 has brought health and wellbeing to the forefront for a lot of us. With the COVID-19 pandemic causing hundreds of thousands of deaths worldwide, many people may now be considering their own mortality and how they can plan for when they pass.

Claire: I was surprised to learn that unlike your other assets, your super and any insurance benefits attached to it aren’t considered part of your estate.

Mark: Yes, it doesn't seem to be commonly known. The reason that this is the case is because your super is legally considered to be held in trust until you are eligible to access it. For this reason, choosing a beneficiary now could save putting that responsibility on your loved ones if the unexpected occurs.

Claire: So even if you have set your wishes out in your  Will, your super fund will still need a valid nomination from you to release your super in the way that you want?

Mark: Yes, that’s right. So you need to do what is called Nominating a Beneficiary.

Claire: What is a beneficiary?   

Mark: A beneficiary is a person or people you nominate to receive your Superannuation Death Benefit (this is your super account balance plus any death insurance cover you have with the super fund) in the event of your death.      

Claire: What options do I have?        

Mark: As a  Child Care Super member you have two options when nominating beneficiaries:

1. Non-binding nomination

If you make a Non-binding nomination, your wishes about who should receive your Superannuation Death Benefit are a guide only and are not binding on the Trustee. The Trustee will take your nomination into consideration but it is the Trustee who makes the final decision.

You can make or change a Non-binding nomination at any time using  f (you will need your member number and PIN) or by calling Child Care Super on 1800 060 215 .

2. Binding death nomination

If you make a valid binding nomination, generally this binds or requires the Trustee to pay your Superannuation Death Benefit to your nominated beneficiary.

A Binding nomination expires every three years from the date it is accepted by the Fund. You will be sent a reminder a couple of months before the expiry date to renew your nomination. Of course, you can change your nomination at any time by making a new Binding nomination.

Claire: Who can receive your super?

Mark: Your beneficiary could be:

  1. your spouse or partner, including same sex partner
  2. your children, including step children
  3. interdependents (someone who lives with you and shares a close personal relationship where one or both of you provide financial and domestic support, and personal care of the other)
  4. other financial dependents (such as someone who relies on you financially)
  5. your estate or legal personal representative

It’s important that parents cannot receive your super benefit simply because they are your parents.  

Claire: What happens if my beneficiary changes over time?

Mark: Good question, it’s very important to keep your beneficiaries up to date. Especially, when your circumstances change. For example, if you divorce or have more children. It’s quite common for people to forget to add their youngest child or remove their ‘ex’ as their beneficiary – which can cause problems.

Claire: Great discussion, thanks for sharing. Any last titbits of advice?

Mark: Yes, once you’ve made your nomination it’s a good idea to let your beneficiary know that you have nominated them. I would also suggest that you let them know that Child Care Super is your super fund.

Claire: Thanks!

Claire’s super savvy tip

If you would like help with your beneficiary nomination, you can arrange an appointment by calling 1800 060 215 .