For most people, superannuation is one of the most significant assets that they own, and it is important to make sure that it ends up where you want it after you pass away.
Unlike many of your other assets, superannuation is not what is known as an ‘estate asset’. This means that your superannuation will not automatically be counted as part of your estate on your death.
Therefore, it is important that you very carefully document how you would like your superannuation to be accounted for if you pass away.
If you do not leave a death benefit nomination then the trustee of your superannuation fund is responsible for deciding how the super will be distributed.
There are two different types of death benefit nominations: binding and non-binding. A binding nomination means that the trustee will have no option but to comply with your directions. A non-binding nomination means that the trustee retains some discretion over the decision.
Binding death benefit nominations should be regularly updated to reflect any changes in your circumstances. For example, if you were to remarry, have another child or separate from your partner you may wish to change your plans for your superannuation accordingly.