A binding death nomination is how you may stipulate whom receives your superannuation funds upon your death.
Superannuation is a trust structure, this means that your assets held here do not form part of your Will. So if you think you will pass on your super to whom you intend through your Will think again.
The trustees of a super fund have discretion to work out whom is dependent upon you at death and then pay these funds out appropriately. This may not be in accordance with your wishes.
The most important thing to do then is put a nomination in place as to whom you want your benefits paid.
The reason you use a binding nomination is this is then “binding” on the trustees to pay out as you desire. If you just use a non-binding nomination the trustees still have discretion to review whom is dependent upon you and may then make a decision to pay to more of your defendants than you stipulate.
Another reason to use a binding nomination is to speed up the process of the death claim for your beneficiaries. If a binding nomination is in place there is less time and research by the trustee on whom to pay the benefit so it takes a lot less time to pay out your benefits.
Even if you want to distribute your super assets through your Will, you are still better off to put a binding nomination in place that asks to pay your benefits to your legal personal representative.
You won’t be here to know but the more of your affairs you have sorted out and are in place correctly the easier it will be for your beneficiaries.
If you wish to obtain help putting a binding nomination in place on your super or have any questions regarding this please give the staff at Ritchie Advice a call we would be more than happy to help.
This advice may not be suitable to you because it contains general advice which does not take into consideration any of your personal circumstances. All strategies and information provided in this article is general advice only.
Ritchie Advice Pty Ltd ABN 12 150 128 448, is a Corporate Authorised Representative 408050 of Dover Financial Advisers Pty Ltd, Australian Financial Services Licensee No. 307248.