Separation & Super
Separating from a long-term partner is enormously challenging and when it comes to finances it may require a lot of short and long term planning during a time when emotions are also fraught.
Most people automatically acknowledge the first steps in separating finances and usually take care to promptly close off joint accounts, cancel redraws and access to shared credit cards and establish new bank accounts.
While the impacts to your day-to-day finances and the arrangements for your children (if any) are essential and should be considered with priority, it’s important to also consider your long-term investments such as super.
Super is an asset like any other. A separation or divorce from your partner likely involves dividing assets and debts – super is no exception.
When you separate, it makes sense to gather all relevant financial information and collect important documents including super statements (both yours and your partner’s).
And remember, you don’t have to be married to have claims to super – you can be in a de facto relationship – the laws will differ depending on your state or territory.
When dividing super, usually there are three options when it comes to managing super during a separation.
- Split the super by agreement, or by court order. If couples are unable to agree, the court can make an order as part of a property settlement. A valid agreement or court order is binding on the trustee of a fund.
- Defer your decision about how to split the super assets until another time, such as retirement.
- Consider super assets as part of the financial settlement, but choose to leave them alone i.e each party retains their own entitlements.
Other things to consider – your super statement has information about who should receive your super if you die – your beneficiaries. It’s important to carefully reconsider this information in light of your new circumstances.
It’s also worth noting that super of little value i.e less than $5,000 or amounts deemed not cost effective will not be split by agreement or court order.
When approx. one in three Australian marriages end in divorce, you can be sure there’s plenty of qualified people who have experience in helping people manage these situations and are willing to help you do your best to protect your financial future.
Interested in finding out more about how to protect your interests through estate planning? Have you separated from your partner and need help with your super and broader finances? Highview’s experts can provide you with more information.
Finally, if you’re in the midst of separating or dividing your finances due to relationship breakdown, professional legal advice should also be considered as part of this process.
Source: SuperInformed Magazine – February 2019