It may not be the most pleasant of things to contemplate but considering your ultimate financial legacy and discussing this with your trusted accountant or adviser can be enormously beneficial. It can help you leave a better financial legacy and leave your accountant or adviser in a better position to communicate that legacy to those left behind.
Regular Check In
Making it a regular part of your conversation with your accountant or adviser may certainly help to ensure that what you want is not overlooked as a too hard subject. You might discuss things like:
Who decides how your superannuation is paid when you die?
It may be news to you that your legal will does not deal with your superannuation benefits automatically. If you want your superannuation dealt with by your will, there is action you will need to take to make that happen.
What do you really want to happen?
You may have strong opinions on exactly what you want to happen with your superannuation monies when you die or you may actually not care. Having the conversation, helps your accountant or adviser educate you on the options available for recording your wishes or for seeking further specialist legal advice.
What documents do you currently have in place for your superannuation benefits?
It is prudent to periodically review the documents you have in place to check that they property reflect your current wishes.
Are there other changes I need to notify?
As well as discussing your death benefit nominations, there may be other critical matters affecting the operation of the SMSF that you should be disclosing to your accountant or adviser, such as incapacity.
Taking the step to discuss your death benefit wishes can help focus your accountant or adviser on the steps they can take with you now to optimise the outcome you are seeking. For example:
Chain of Deed Review
If you want the comfort of knowing that your death benefit nomination documents are valid and will deliver the outcome you desire, then you may considering having them checked by a lawyer. A proper chain of deed review including their death benefit nominations can deliver the comfort you need.
Review Trustee Arrangements
Considering your Trustee arrangement, particularly if your SMSF has individual trustees can save those left behind unnecessary concern and cost. There may also be other times when changes to your Trustee structure may be prudent or required, such as if you are considering leaving Australia or your health is deteriorating.
Specialist Legal Advice
You may have complexities in your financial or personal affairs that may warrant specialist legal advice and your accountant and adviser may be able to assist in making an appropriate referral and liaising with them to deliver your preferred outcome.
Specialist Investment Advice
How death benefits are paid may be impacted by the types of investments held, particularly if they are illiquid. It may be a good time to engage a licenced financial planner to review the SMSF’s liquidity, insurance and other investment considerations, particularly if a less engaged member will be left managing the SMSF.
The more informed your accountant and adviser are, the more likely they are able to guide you about structuring your benefit to minimise the tax on your death benefit. Keeping them abreast of changes in your working arrangements and health can aid the timeliness of this guidance.
Changing when you do things
If you make personal concessional contributions, you may be in the habit of completing the Notice of Intent and Trustee Acknowledgment at financial year end. As you age or your health conditions change, it may be prudent to arrange this signing with each contribution that is made. This change ensures that the claim for each contribution is valid in all circumstances and can avoid unwelcome outcomes, particularly in a year you have made other contributions.
Openly discussing your death benefits, gives your accountant and adviser the information they need to guide you toward the financial legacy you intend. It also helps them clearly communicate that legacy to those left behind.
Lifetime SMSF, as your Document Agent, can control the effectiveness of the documentation around your SMSF. Our many years of experience in SMSF allows us to help you maintain compliance and avoid complex outcomes. What we do know is that inferior documentation can have impacts well into the future. This is why our documentation service considers events beyond just your lifetime. If you are concerned that your SMSFs documentation is not in order contact us now - About | Lifetime SMSF