Wednesday 24 July 2013

Consolidating my superannuation

Now that we are about to sell our investment property and pay off most of the mortgage on our home, it seems superflous to keep paying $160 a month for a $400,000 life insurance (Death and TPD) policy from my old BT Employer Superannuation Fund account. I'll retain my loss of income insurance policy, but if I die the balance of my SMSF account should be sufficient to look after my wife and kids. In any event at the current rate of life insurance premiums my BT Fund would have been tapped out in a couple of years anyhow, so I decided to rollover the balance (~$4,800) into my SMSF while there's still some money sitting there.

The process of closing my BT account and rolling over the funds into our SMSF was very straighforward. I simply downloaded the ATO 'Request to Transfer whole balance of superannuation benefits between funds' form from the eSuperfund website, filled in my personal details (name, address, DOB and TFN), the details (fund name, account number, ABN, and SPIN) of my BT account (the 'from' fund), and filled in the details for the 'to' account (fund name, member number, ABN of my SMSF). Recent legislative changes now require proof of identity to be included with rollover requests, so I simply had to drop in to my nearest Westpac Bank branch to have my licence copied and certified, and sent with the form to BT (they are a subsidiary of Westpac).

My finances are slowly being simplified over time, and having only one superannuation account is another step along that path.

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Alex said...

With your life insurance changes would your fund allow an anti-detriment payment? This would likely be significant. said...

Not sure it relates to my life insurance change per se, as I'm simply dropping my life insurance and transferring out the current balance of my BT super fund that would otherwise have been used to pay the insurance premiums for the next couple of years.

However, if I die and my SMSF account balance gets paid out the anti-detriment payment may apply. However, being a SMSF fund, any payment has to be coming out of the total fund value - which is simply my account balance and that of my wife (who would be the beneficiary of my super if I die). So, paying out an anti-detriment payment would be a zero-sum game, unless it triggers some sort of tax saving for the beneficiary...

I just I'll just leave a note for my wife to see a superannuation tax expert before she, as the surviving trustee, goes ahead and pays out my account balance to herself, as the beneficiary ;)