Nick Bruining Q+A: Your must-know guide to care orders while you’re alive and superannuation rules when you go

Question I am about to undergo major surgery, and while the prognosis is reasonably positive there is a risk that I might not survive or I could be permanently incapacitated. I have been trying to get all my documents in place but I am confused about the options available for my superannuation funds. Answer At any age over 18, your estate and personal affairs can be managed using three key documents. An enduring power of attorney allows you to appoint one or two people to manage your financial affairs. You can attach conditions and appoint up to two substitutes to cover most circumstances. Lifestyle and personal affairs such as medical and accommodation decision-making powers can be assigned through an enduring power of guardianship. Again, up to two people can be appointed and they could be the same people listed in the EPA. The final document is an advanced health directive. It allows you to specify what medical treatment you prefer and, in effect, supersedes any decisions your guardians might make using the EPG. All of these documents can be downloaded for free via the Office of the Public Advocate At the time of death, all of these instruments cease to have effect and your will takes over. Your will only deals with assets of the estate. Normally, joint assets such as your home and joint bank accounts will pass to the surviving joint owner. Super assets also don’t form part of the estate unless you specifically direct the fund to pay the proceeds to your estate, which will appear on your super fund’s nomination death benefit form as your “personal legal representative”. Your super schemes will offer all or some of the following options. A death nomination form instructs the fund trustees to pay the proceeds to the dependants specified. The trustees could still choose to make payments to other, unlisted dependants. A binding death nomination binds the trustees to distribute as per your instructions. These generally expire after three years. A non-lapsing binding death nomination stays in place until you die or it is updated. These days, most funds offer these types of nominations. Super funds can only make payments to dependants or interdependants. That means the trustees wouldn’t be able to distribute the proceeds to your friends, charities and, in most cases, your siblings or parents. Your best option in this case is to leave the super proceeds to your estate and your will would then distribute the proceeds. We wish you all the very best for your upcoming surgery. Question I have heard that I can access my superannuation if I am in financial difficulties. I recently lost my job and am behind in my credit card and car loan payments. When I contacted my super fund, they said that losing my car and maxing out my credit card is not a financial difficulty. I was very upset and hoping you can explain why I can’t access my own money? Answer I am sorry to hear of your situation and thoroughly recommend you contact a financial counsellor as soon as possible by calling the National Debt Helpline on 1800 007 007. Financial counsellors will be able to assist you in reorganising your finances and possibly negotiating with your lenders to restructure your loan repayments. There are legal obligations for lenders to help you and the financial counselling service is free. Unfortunately, superannuation is not easily accessible. Fundamentally, superannuation is designed to be a source of funding for retirement. It is not easily accessible until you reach retirement age. Indeed, if the worse were to happen and you became bankrupt, creditors can’t normally access your super. Severe financial hardship is defined in the superannuation legislation and requires an applicant to have been on Centrelink income support payments for at least 26 weeks. The super fund has a legal obligation to verify this before releasing an amount between $1000 and $10,000 from your account. And, this amount is taxable. Nick Bruining is an independent financial adviser and a member of the Certified Independent Financial Advisers Association