Have you ever wondered what happens to your superannuation when you die? It’s an important
question, and one that many Australians are asking. After all, a person’s superannuation is often their most important asset, and it’s important to know what will happen to it after they’re gone. In this blog post, we’ll take a look at the ins and outs of what happens to your super when you die.
When someone passes away, their superannuation will go through a process known as ‘super death benefits’. This process involves the trustee of the deceased’s super fund paying out the deceased’s remaining balance (minus any taxes) to their nominated beneficiaries or legal representatives. The amount payable is usually determined by the type of super contributions made by the deceased during their lifetime.
In general, there are two types of super death benefits that can be paid out upon death: lump sum payments and income streams. Lump-sum payments are typically paid only if there is an eligible
beneficiary who has requested them in writing. As for income streams, these can be paid out either in lump sums or as regular payments over time depending on the wishes of the deceased’s estate or beneficiaries. If a beneficiary does not specify how they would like to receive their benefit then it must be paid as a lump sum within 12 months of death.
If there is no valid nomination in place when someone dies, then their assets may form part of their estate and will pass on according to any instructions outlined in their Will or via intestacy laws if
there is no Will or valid nomination in place. In addition, any pension entitlements held by the deceased may continue being paid until such time as deemed appropriate by the trustees of those funds (provided they remain eligible).
Superannuation can be a complicated issue but understanding what happens when someone dies is an important step in making sure that their assets are protected for future generations. Knowing how death benefits are calculated and what options are available for payment can help ensure that those left behind receive exactly what was intended for them from the deceased’s estate. Additionally, having a valid nomination in place before death occurs helps to ensure that these assets are handled according to the wishes of both parties involved – both those alive today and those who have
passed away already. Taking care with such matters now can save a lot of stress later down the line so make sure you get everything sorted before it’s too late!
