Establishing a link between the laws governing wills and those governing superannuation in order to make binding death benefit nominations (BDBN) more workable is at the moment impractical, according to Macquarie Adviser Services executive director David Shirlow.
This was one of the recommendations of the Cooper review, in which the suggestion was made that BDBNs used by superannuation members should be amended when a life-changing event, such as divorce, occurs instead of a mandatory expiry date, as is the case now.
However, as the law covering wills is currently state-driven, more work needs to be done before a move to this structure can be considered, Shirlow said.
“If you look at the state legislation of wills, every state is different. Some states invalidate the whole will, some invalidate part, so it’s all over the shop,” he said.
“So if you tried to put that in national super legislation you wouldn’t have parity between rules and super benefits.”
In light of this, Shirlow said a first step would have to be working towards achieving uniformity of will-making laws across all states and territories and then trying to align these with national superannuation law.
But before this happens, it will be up to individual fund members to make sure their super nomination and their will are updated in conjunction with each other, he said.
“If a life event occurs, the best way to ensure a super fund member’s super and non-super interests are dealt with in accordance with their wishes is for them to review both their super nomination and their will together, so as to produce a co-ordinated result,” Shirlow said.
