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The ties that bind your super...

July 2009

Contributing to super is all about saving for the future. We spend our working life contributing to our super with the aim to enjoy a comfortable lifestyle in retirement and the ability to provide for our loved ones after we stop working.

However, have you thought of what happens to your super in the event that you pass away? It’s a consideration that not everyone thinks about, and as a result, your money may not be distributed as you might have wished.

Binding death nominations

Plum can now offer you the peace of mind that in the event of your death, your super is paid to the people you intended. By making a binding death nomination on your Beneficiary nomination form, you can nominate the dependents you wish to see your funds transferred to. These people can be any combination of your dependants or your legal personal representative.

If you would prefer not to make a binding nomination, the Beneficiary nomination form, gives you the option to make a non-binding nomination as an alternative.

Benefits of a binding death nomination

There are a number of benefits in having a binding death nomination. Perhaps most significantly is the potential to allow you to protect your super from disputes.

In some instances, binding nominations can also have some estate planning potential. An example of this is the potential tax advantages in having your superannuation paid to a minor child and other assets bequeathed to an adult child.

Once you’ve made your choice as to who should receive your funds, it is binding on the Trustee as long as it is still valid at the time of your death. This means that the Trustee is required by law, in the event of your death, to pay your super death benefit to the beneficiaries you have nominated and in the proportions you have nominated.

Recently, the definition of a dependent has been broadened, meaning you may have greater flexibility and choice in who your superannuation goes to in the event of your death. For example a same sex partner would now be included as a dependent.

Something to consider …

• A couple of important factors to consider when completing a Beneficiary nomination form are:
  Different taxation rates apply to death benefit payments depending on who they are paid to. It is important that you seek professional advice before making a death benefit nomination.

• A binding nomination is valid for three years from the date of the form first being signed, last confirmed or amended unless an event has occurred to invalidate your nomination, e.g. a nominated beneficiary dies before you die, even if other nominated beneficiaries survive. Before your binding nomination is due to expire, Plum will write to you requesting you to confirm or re-nominate a binding nomination.
• Regardless of whether you make a binding or non-binding nomination, you should consider seeking independent estate planning advice.
  

Next Steps

To ensure your super funds are distributed to the dependents of your choice, you simply need to complete a Beneficiary nomination form. To obtain a copy of the form, or to discuss binding death nominations further, please contact a Plum Member Services Consultant on 1300 55 7586, any business day, 8.00am to 6.00pm, Melbourne time.

Alternatively log on to Member Online and download a Beneficiary nomination form.

Please note that binding nominations are not available to Pilkington, Mars and Vanguard members.