Sex and Your Money – think with you head and not your…
How much do you tell your parents about the person (or people) you’re sleeping with? While many of us are comfortable with our parents meeting our significant others, not everyone is eager to have their partner meet the in-laws.
This may be for religious or cultural reasons. It may be because Mum’s a closet Monster-in-Law; or Dad tells bad jokes; you’re just not ready yet; or because you believe you have all the time in the world.
However; when one party dies unexpectedly “secret” relationships can often result in bitter disputes between significant others and family members.
A recent matter in the ACT Magistrates Court involved a dispute between a mother and her son’s girlfriend over death benefits (valued at approximately $200,000). The son passed away as a result of a workplace accident. Both Mum and girlfriend applied to receive his work cover benefits.
Girlfriend won. In her favour were numerous cards, notes and text messages from the deceased, where he declared his love for the girlfriend and intention to marry her. The deceased also put down the girlfriend’s name as his emergency contact person at work and these factors, along with others satisfied the court that the relationship was serious and the girlfriend was dependent on the deceased.
During trial, Mum alleged that no-one in the family knew or had met the son’s girlfriend. His cleaner gave evidence that there was no evidence of anyone living in the son’s home. Further, even on her best case scenario, the girlfriend’s relationship with the son was only of 8 months duration and Mum alleged that the girlfriend was neither dependent on the deceased, nor were the deceased’s comments about marriage serious.
Whether the deceased’s declarations of love and marriage would have stood the test of time is now moot. We romantics will certainly hope so.
However, the moral of the story is…
1. don’t’ be afraid to talk about death with your family – It’s one of life’s only certainties;
2. think about who you put down as your emergency contact and how you describe your relationship;
3. make a valid will; and
4. make a valid Binding Death Benefit Nomination (BDBN).
BDBN’s are something many people (young and old) don’t give serious thought to. If you don’t have a BDBN and die, your superannuation is potentially up for grabs among the dependants you leave behind. Under superannuation laws, the trustee of your superfund will usually have discretion to decide who receives your super - unless you have a valid BDBN and remove that discretion.
The downside of this is that it may mean that, if you change your mind about who you nominate as your beneficiary and don’t get around to doing a new BDBN, that person may get their hands on your super after you have gone and it is too late to argue. So review your BDBN regularly as it makes your estate planning more precise and effective.
Had the young man in this example had a valid Will or valid BDBN the whole dispute could have been avoided. Whether Mum or girlfriend would have been happy with the outcome, we will never know… But it would have been his choice where his money went after he died.