It can be a difficult topic and something that may not be front of mind, but have you thought about who you want your super to go to in the event of your death?
Many people assume that their super entitlements are automatically included in the value of their estate and will be paid out in accordance with their Will. However, there’s strict legislation in place that outlines who can receive super benefits after someone has passed away. You can make a separate nomination to let QIEC Super know who should receive your super and any insurance payments you may be eligible for, known as a ‘death benefit’, if you pass away.
By having a valid binding nomination in place, the Fund is required to pay out your death benefit to your nominated beneficiary/ies, giving you peace of mind.
QIEC Income Stream members also have the option of nominating a reversionary beneficiary. This means whoever you nominate will receive your QIEC Income Stream payments in the event of your death or they can choose to receive the total amount as a lump sum payment. Just like a binding nomination, a reversionary beneficiary must also be a dependant.
If you have a preferred nomination, an expired or invalid binding nomination (or no nomination at all) in place at the date of your death, the Trustee will consider who you chose, but ultimately, they are legally responsible for deciding who to pay your benefit to after you die, and they have to follow relevant superannuation laws.
There are strict rules regarding who you can nominate as a beneficiary. Your death benefit can generally only be paid to your dependants, Legal Personal Representative or your estate. Under superannuation law, your dependants are:
- a spouse (including de facto spouse or same sex partner);
- a child of any age; or
- any person with whom you have an interdependency relationship.
For all information and rules around binding and reversionary nominations, please read the ‘Nominating a beneficiary’ section in the QIEC Income Stream PDS.
Updates to your nominations can be made at any time.
A ‘standard’ binding nomination is only valid for three years, so it’s important to renew your nomination before it expires for it to remain valid. Once it becomes invalid, your nomination will no longer be binding on the Trustee and will be treated as a preferred beneficiary nomination.
A non-lapsing binding nomination does not expire after three years and remains in place until it is revoked, amended or becomes invalid. Although you won’t need to renew your nomination every three years, it’s even more important that you regularly review your nomination to make sure it reflects your wishes.
A reversionary beneficiary nomination remains in place until it becomes invalid due to either divorce or death of a nominated beneficiary. If the reversionary beneficiary is a child, the Income Stream must be paid out as a lump sum once the child attains age 18 years of age. You can’t nominate a child aged 18 or over unless they’re between 18 and 25 and financially dependent on you, or they’re disabled within the meaning of the Disability Services Act 1986 (Cwlth).
You can make a binding nomination by either completing a Binding Nomination of Beneficiaries Form or Non-Lapsing Binding Death Nomination of Beneficiaries Form. You can make a reversionary beneficiary nomination by completing a Reversionary Beneficiary Nomination Form.
You can also speak to a QIEC Financial Planning (FP) Financial Planner who are available to assist with beneficiary nominations for your account.1 Simple advice about beneficiary nominations for your QIEC Super account is considered Intra-fund advice and is covered by your QIEC Super membership at no additional cost.
Did you know?
Only 8% of QIEC Super members have a valid binding or non-lapsing binding nomination in place. 70% of QIEC Super members have a preferred or expired binding nomination in place, while 22% of members have no nomination in place at all.
Not having a nomination in place can lead to lengthy disputes, added stress and long processes to determine who should receive a death benefit.
QIEC Super is here to help
If you have any questions about binding nominations, or would like to speak to a QIEC FP Financial Planner, call us on 1300 360 507 between 8:00am – 5:00pm Monday – Friday or email us at email@example.com.
1 QIEC Financial Planning advice is provided by My Super Future Pty Ltd (ABN 38 122 977 888) Australian Financial Services Licensee (AFSL no. 411440) and is authorised to provide personal financial advice. The Trustee QIEC Super Pty Ltd (ABN 81 010 897 480) is not responsible for, and does not accept liability for the products or services or actions of My Super Future.