When you make a detailed will and make sure that it is registered correctly, your affairs will generally be taken care of efficiently and in accordance with your wishes. This can certainly make life a lot easier for your dependents as they deal with the grief, but you can't automatically assume that your superannuation benefits will pass to them, just because they are accumulated in your name. Why do you have to handle this differently and what pitfalls could you face?

Dealing with the Trustee

While superannuation is intended to create a benefit for you upon retirement, it's important to remember that it is not something that is legally owned by you. Typically, it will be managed by a trustee within a separate vehicle and it will be up to said trustee to distribute the benefits after your death.

You should be aware that third parties may be able to make a claim against your super benefit under the sometimes-complex rules and regulations, so to avoid this you need to nominate some beneficiaries and lodge this information with the trustee.

Binding Nominations

You will want to take any uncertainty out of this equation and make the job of the trustee a lot easier. After all, if they haven't received a nomination from you, or you've submitted some paperwork that is invalid, then your family may be disappointed. However, if you made a binding death benefit nomination then you can take care of the situation, and this nomination can be either lapsing or non-lapsing. In the former case you will have to renew the declaration every few years.

How to Nominate Others

It's not unusual for somebody to nominate that somebody other than their immediate relatives receive their benefits in a last will and testament. Some people think that they may be able to make a binding death benefit nomination in favour of these people, but this is not possible. Superannuation rules clearly determine that the trustee may only allocate benefits to dependents, so if you want to go down this road then you will have to tell the trustee to pay everything into your estate instead. When you do this, you will be able to detail how this money can be distributed within the will, so long as everything is valid and up to date.

Don't Leave It to Chance

This is of course a very serious matter to consider and you shouldn't leave anything up to chance. When you engage a wills and estate lawyer, they will ensure that your nominations are always valid, up-to-date or renewed as necessary.