What happens to my super when I die?

Superannuation is not an asset and requires a separate death benefit nomination form.

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Most end-of-life planning is generally focused around an individual’s will. The common-sense conception of a will is that it is the single document which dictates where everything you own goes after you die.
If your will specifies what is to happen to all your assets upon your death, this principle is correct.

However, your superannuation is not an asset. It is constituted of funds held in trust for you by your super fund, which acts as the trustee of your super trust fund. 

This process may vary in the case of a self-managed super fund, in which scenario you should ensure that the trustee of your SMSF is informed of whom you have nominated to receive your death benefit. 

Most superannuation funds enable you to nominate a beneficiary for your superannuation via a death benefit notification form. As the trustee of your superannuation, your fund is empowered to pay a Death Benefit to your nominated beneficiary or beneficiaries. 

Generally, the only people eligible to receive a death benefit are spouses, children, financial dependents, or interdependents. As a single person without children however, siblings, friends, or parents cannot be nominated simply by filing a death benefit form as they are not necessarily considered valid beneficiaries. 
 In order to avoid these issues, it is possible to name a ‘legal personal representative’ on the nomination form. Doing so means that the death benefit becomes part of the estate and can be allocated within your will. It is important to note however, that a death benefit accrued by someone who is not a dependent will be taxable up to 30 percent. 

For advice on how to ensure that your super goes where you want it to after your death, contact Warlows Legal today.

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