Working out how to help, and what happens to your wealth when you die, can be complex and confusing, and almost always requires professional advice.

Superannuation is most retirees’ largest or second-largest asset so it pays to understand how it works and strategies that save money and tax.

AustralianSuper’s national manager of advice, Frank Ceravolo, said new retirees should switch some or all of their super accumulation funds to the pension-paying phase.

“This will help to generate a better investment return by eliminating tax on these returns and allow easier budgeting due to regular income payments,” he said.

Seniors can potentially add money to their super until age 75 if they have some paid work, and should aim to hold a mix of assets — not just cash — for long-term growth.

In late retirement, more money issues can arise.

Super is not counted as an estate asset in a will, so retirees should consider making binding death benefit nominations to make their wishes clear.

“Otherwise the trustee of the funds must exercise its discretion … funds could be paid to individuals, or more paid to some and less to others, than the retiree would have chosen,” Mr Ceravolo said.

Planning for Prosperity senior adviser Daniel Budreika said retirees should ensure that their estate planning was sorted.

“A lot of people leave that to chance,” he said.

Updated wills, powers of attorney and advanced health care directives will help lower family members’ stress.

Mr Budreika said super needed extra care around this time.

“Make sure it’s not left to people who are ineligible. Leaving it to a dependent beneficiary can help to minimise tax.”

Adult children are generally not dependent beneficiaries, so if a fund member dies and does not have a spouse, their super payout is likely to be taxed at 17 per cent before it gets to their children.

“Quite often that’s tens of thousands of dollars, depending on the balance,” Mr Budreika said.

If super is withdrawn before you die and put into a bank deposit, there’s no tax paid by family members, but knowing the exact day you will die is beyond most people.

It may make financial sense for some retirees to cash out of super early if their assets in super are relatively modest.

“But tread carefully — you don’t want to be in an adverse tax position,” Mr Budreika said.

@keanemoney