What is a BDBN?
It’s a legally binding nomination that allows you to advise the trustee who is to receive your superannuation benefit in the event of your death.
Why is it important?
Superannuation does not fall under an estate asset, that means upon your passing it does not automatically flow to your estate. The trustee of a super fund will pay out your member balance in accordance with the trustee deed and relevant law. This means the trustee has discretionary as to how your superannuation will be paid out and to who.
By having a binding death benefit nomination in place, you decide who should receive your superannuation balance. For most people it might as straight forward as leaving this money to your spouse, children or family member. For others with blended families this may be more complicated.
Death benefits where a BDBN is in place are often able to be paid out quicker than not having a BDBN place.
How long do they last?
A BDBN is prepare it will remain valid for 3 years. However, its best to review your BDBN each year or as your circumstances change.
How can I check if I have one?
If you have a self-managed superannuation fund – you will need to contact your administrator (usually your accountant) to check if your BDBN is current.
If you have an industry or retail fund – you will be able to check by either calling your super fund or using their online services to check when you last prepared one.