Does my will cover my Superannuation?

Conversations about death and dying may be morbid and can frighten some people. However, it’s a necessary topic to talk about, especially when money and belongings are involved. Many Australians wonder what happens to their life insurance and superannuation accounts after their passing.

Death benefits can be rather complex, and they cannot be covered in the will unless instructions have been specified with the super funds’ trustees beforehand. The insurance and superannuation balances will usually go to your dependents and legal personal representatives when you die.

Why Can’t My Will Cover My Superannuation?

Your will covers assets that you personally own, which includes things like your car, house, investments, personal items, and bank balances. It is a legally binding document that allows a person to control how these things will be distributed after death. The owner of the will can specify who receives what and when they can get the assets.

On the other hand, the superannuation account acts under different rules because it is governed by superannuation law and handled in a trust by a super fund trustee. For this reason, you cannot include it in your will unless the necessary arrangements have been made beforehand.

Who Controls Where My Super Will Go?

Your superannuation fund trustee will control how and where your assets will be distributed depending on extant rules in the super funds’ trust deed. However, you can complete a binding death benefit nomination, and the trustee must pay the death benefits to the nominated beneficiary.

If there are no binding death benefit nominations, then the trustee will pay the benefits to your dependent or legal representative. In some cases, the funds are only bound by the trust deed to the legal personal representative of the deceased. The legal representative will then distribute them in accordance with the deceased’s will.

Who Are Eligible Dependents and Legal Personal Representatives?

The eligible beneficiaries that can receive your death benefits may include your spouse (excluding former spouses and including de facto and same-sex partners), children, dependents, and legal personal representatives.

A legal personal representative is a person appointed by a court to administer your estate. This person can be specified in a will. The personal representative is typically also in charge of executing the instructions in the will after the owner has passed.

Appointing a legal personal representative allows you to specify how you want to distribute your money after death. When you nominate them in a binding death benefit nomination, they will receive your superannuation and insurance balances and can then give them to whoever is in the instructions in the will. It’s always important to keep your will and nominations up to date.

Seek Advice Regarding Your Will and Super

Although death is a morbid topic to talk about, it’s a fact of life that we have to meet with grace and courage. Determining who gets what after your passing is a responsibility that you have control over, and it’s always best to plan ahead to make the most out of life without worries.

If you’re looking for assistance regarding wills and estates in Redland Bay, Bickell & Mackenzie can help. We provide care and compassion in our services, accommodating families in preparing documentation and distributing estates to beneficiaries as comfortably as possible. Allow us to help—get in touch with us today.

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