Beneficiary who?
Did you know that you can have peace of mind knowing that your loved ones who need it most will receive your money if something happens to you? By updating who you’ve nominated as beneficiaries to receive your retirement benefit when you pass away, you can make sure your family is taken care of when you are no longer here.
A beneficiary is a person that you nominate to receive all or a percentage of the money of your retirement funds. You can nominate one person or more persons and choose the percentage you want each beneficiary to get. After every major life event, such as getting married, the birth of a child, getting divorced, or if one of your nominated beneficiaries passed away, it is also essential to update your beneficiary nominations.
Beneficiaries should include your spouse or partner, your children, any person that is financially dependent on you or any person that you want to receive a part of your benefit.
Dependants get preference
The trustees place great weight on your beneficiary nomination, especially if it is up to date. However, the trustees of your retirement fund have to follow the process as set out in the Pension Funds Act. This means that your dependants get preference over non-dependent beneficiaries, and therefore the death benefit from your retirement fund will not necessarily be distributed as specified on your nomination.
This is because your pension money does not form part of the assets in your estate and therefore falls outside of the wishes you express in your will. The trustees have to determine the needs of those persons that were financially dependent on you and see if it would be possible to meet that first, before considering other potential beneficiaries.
Financial dependants don’t have to be family, and can include anyone you supported financially.
If you don’t have any dependants and you have nominated someone else to receive your retirement fund benefit, it will be paid to that nominated beneficiary 12 months after the date of your death.
Then why nominate anyone at all?
The trustees of your retirement fund will use your nomination form as the starting point. The nomination can guide them to decide who to consider as dependants and potential beneficiaries of your pension money and then decide what will be the fairest and most reasonable way to divide the money among them.
Benefits of investing in a Momentum Retail Retirement Fund:
- Enjoy tax-free growth potential and receive a tax deduction for the money you invest (within limits)
- Get tax allowances when you retire
- Your money is safe from creditors
- The benefit payable on your death will be paid to your beneficiaries will be paid beneficiaries directly and there is no estate duty on the benefit
Other benefits of nominating and updating your information
- Saves time: Knowing where to start will speed up the investigation and your dependants may get the money quicker.
- Saves costs: If you do not have any dependants and you have nominated non-dependent beneficiaries, the benefit will be paid to them and not go into your estate. An executor’s fee is generally paid based on a percentage of the assets in your estate, and the fee will be lower if your retirement fund benefit is not paid into your estate.
- Avoids extra hassle: If you do not have any dependants and also did not nominate a beneficiary, and you also do not have an estate, the benefit will be paid to an unclaimed benefit fund or the Guardian’s Fund. Completing a nomination will avoid that.
- Makes it easier: Many members, and their families, can’t be contacted to receive their benefits because their contact details are outdated.
Do we have your correct contact details?
Members can update their personal information directly with us by calling us on weekdays from 08:00 to 17:00 on 0860 546 533 or email [email protected].
How to update your list of beneficiaries
- Speak to your financial adviser if you want to find out who your beneficiaries are or to update your beneficiary list.
- You can also log in to your Momentum profile to see your beneficiaries.
- Not yet registered? Create a login profile.
- To change your beneficiaries or to update their contact details, email us a signed request with your policy or investment (contract) number, or contact us at [email protected]. Your beneficiary list will be updated once we have confirmed it in writing.
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