‘How can I ensure my grandkids, not my children, benefit from my super?’

• How do I manage to navigate around above?
• What would happen to the superannuation if I didn’t have anybody listed in the ‘relationship to member’?

A. This is a good question. Actually, neither your children nor your grandchildren may be regarded as financially dependent or in an interdependent relationship for superannuation purposes unless they meet strict technical guidelines. To be financially dependent effectively means what it says – the children or grandchildren must be still living with you and/or dependent upon you to meet the majority of their financial needs. Occasional gifts will definitely not qualify you for this definition.

An interdependent relationship implies someone being emotionally or financially dependent upon you and could include, for example, a sibling or a parent or other family member.

Assuming that your grandchildren do not fit these categories, you can still leave your superannuation entitlements to them through your will, however. You can instruct your superannuation fund that your beneficiary is your ‘personal legal representative’ as this person is effectively the executor of your estate. You then need to ensure you specify in your will that your superannuation monies are to be left directly to your grandchildren.

You should be aware that non-dependent grandchildren will pay some tax on the receipt of the superannuation benefit. You will need to get personal advice if you want to find out how much, but it is a maximum of 15 percent of the account balance.

If you have a question for Starts at 60’s money experts, email it to [email protected].

IMPORTANT LEGAL INFO This article is of a general nature and FYI only, because it doesn’t take into account your financial or legal situation, objectives or needs. That means it’s not financial product or legal advice and shouldn’t be relied upon as if it is. Before making a financial or legal decision, you should work out if the info is appropriate for your situation and get independent, licensed financial services or legal advice.