Have you thought much of your superannuation? If you are young, and you have never seen an Estate Planning Lawyer – count yourself a member of a very large majority. The most common comments we hear are:

  • “I’m only young, I will worry about it later.”
  • ‘I’m not sick or dying, why do I need to do anything?”
  • “I have nothing of value, no house or money, why do I need to see a lawyer?”

People forget they have one asset that can be of significant value – superannuation.  Equally important, they do not consider the devastation they will cause to their family, if they die without leaving directions for their family.

Proper Estate Planning is not only for the elderly or wealthy. Clients often believe that if they do not have real estate, or significant savings or investments, that they do not have anything of value to be distributed in their Estate – but they forget their superannuation has a value, and often times has an attached life insurance benefit.

If you have worked during your lifetime, you will have accumulated superannuation. This is a valuable asset which must be distributed upon your passing. Many superannuation funds also provide life insurance to their members. If your superannuation has life insurance, the Superannuation Trustee may pay the death benefits to your nominated beneficiaries (which may include your spouse, children or dependents or your Estate).  Often times, the Superannuation Trustee pays directly to your Estate. Remember, unless the Superannuation Trustee determines it to be so – your superannuation does not form part of your estate. 

One of our primary recommendations when consideration superannuation planning, is to ensure that our clients have a nominated “binding death nomination” made on their fund – which requires the Superannuation Trustee to pay death benefits to only those intended by our client.  Some superannuation funds do not permit “binding death nominations”, and for those funds we consider a “non-binding nomination.”  In our experience, families who are left to deal with superannuation trustees where no nomination has been made, battle with guilt and grief, and the perception that they are “caring only about the money.”  By simply making the nomination, the family can rely on this showing as a sign of our client’s actual intentions.

As a paralegal in the Estate Team, I have witnessed the nightmare that parents and families go through when they have to deal with the unforseen death of their child and loved one. 

I have worked on a number of similar files over the last year, involving the death of young adults with separated parent.  One of the files involved a young adult who passed away with a large superannuation insurance death benefit.  His mother and father divorced when the child was young. The father was absent from the child’s life and provided little to no financial support to the mother, and did not seek to maintain a relationship with the child. The mother, however, provided extensive support and encouragement for the child through his adult life, often to her own financial detriment, and was a present and influential presence in the child’s life. The child unexpectedly passed away leaving a substantial amount of superannuation.  The mother was tortured in having to prepare sworn statements about the child’s history, which could have readily been avoided if the child had merely nominated her as his binding death nominee.  In the end, the funds were paid to the mother, but not without significant personal devastation.

If the Superannuation Trustee had nominated to pay the funds to the child’s Estate, because he had no Will, the family would have had to apply for probate and the rules of intestacy would have applied, being that the benefit would have been paid 50% to the child’s mother and 50% to the child’s father.  We expect, knowing the history, that the child would have not been agreeable to this.

However, if he had left a Will, at least he would have avoided intestacy, and could have directed the entire benefit to his mother. Fortunately, it did not have to go through this process, because we prevailed at winning the distribution at the Superannuation Trustee level.
Further, the value of leaving your direction, even in a Simple Will, cannot be overstated in terms of helping families overcome the loss and devastation of your passing.

We welcome you to contact our offices on (07) 5574 3560 or email info@nautiluslaw.com.au. We thank you for considering Nautilus Law Group.