We all want to make sure the people we love are taken care of if we’re not around to do it ourselves. Making sure you’ve told your super fund who you want your super to go to is an important part of that process.
If something were to happen to you, do you know who would get your super? Unlike your house, car or personal savings, your super doesn’t automatically form part of your estate or follow the instructions in your will.
Because super has very specific purposes – including to fund your retirement, or to provide for people who you were financially providing for at the time of your death, like your partner and children – it’s treated differently from your other assets.
A beneficiary nomination lets your super fund know who you would like to receive your money (and if you have insurance, your insurance payment) in the event of your death.
If you die without a valid beneficiary nomination, the fund decides who gets your money – meaning it may not get distributed the way you would have wanted.
Who can you nominate?
You can’t just nominate anyone though – it often surprises people, but superannuation law gives you a limited number of choices. Eligible beneficiaries generally include:
Your wife, your husband or your partner
Your child (including adopted children and stepchildren)
A person with whom you have an interdependent relationship at the time of your death.
Two people are considered to have been in an interdependent relationship if they meet all three of these conditions:
They had a close personal relationship
They lived together
One or both of them provided financial, domestic and personal support to the other.
You can leave your super to more than one person, you just need to specify the percentage of your balance you would like each person to receive.
If you would like to leave your super to someone who is not a dependant under superannuation law, you can nominate your legal personal representative (eg the executor of your Will - they don’t have to be a lawyer).
How different nomination types may affect who gets your super
There are two main types of beneficiary nominations and one of the key differences between them is who has the final say over who receives your super when you die – you or your fund.
With a valid binding nomination, your fund generally has to pay your super in the way you've specified. A non-binding nomination indicates your preference and while your wishes will be considered, your fund is not legally required to follow them.
If you’re a Vision Super member, you now have two options for binding nominations:
A non-lapsing binding nomination stays in effect indefinitely – unless you change or cancel it. This nomination does not expire but may become invalid if something big happens in your life – like getting married or divorced.
A lapsing binding nomination expires three years from the date you sign it. You can renew it, change it to a non-lapsing binding nomination or make a new one at any time. We will let you know when your binding nomination is due to expire and if you don’t renew it, we’ll treat it as a non-binding nomination.
You can set up a non-lapsing binding nomination online
The non-lapsing binding nomination is a new option in your online account that allows you to quickly and easily create (or change) a legally binding nomination online.
However, if you want to make (or update) a lapsing binding nomination, you need to download and complete a paper copy of the beneficiary nomination form, which must be witnessed by two adults who are not your beneficiaries.
Taking the time to nominate who your super goes to can give you peace of mind now - and make a meaningful difference for the people who matter most. Visit the Vision Super beneficiaries page to learn more about making a nomination.
Any advice in this article is general only and has been issued by Vision Super Pty Ltd (ABN 50 082 924 561) (AFSL 225054) as the Trustee of the Local Authorities Superannuation Fund (ABN 24 496 637 884) (‘Vision Super’). The advice does not take into account your personal objectives, financial situations or needs. Consider the relevant PDS and our TMDs before investing, available at visionsuper.com.au.