Financial Care Services Newsletter

by Christine Hopper
Volume 12 Edition 6 – 30 June 2022

Financial Care Services, the specialist adviser to seniors in transition to new lifestyles

Have you lost contact with your money?

Remember that rainy day money you quietly parked in a five year term deposit at another bank.
That other bank would have rolled it over for another five years when you moved away without a new contact address.

Did you close mum’s old passbook account when you started doing her banking online?
Maybe dad still has a savings account holding his funeral money.

If those bank accounts have not been active in the last seven years then your money might have been transferred to the Commonwealth as ‘lost money’.

Yes, you could retrieve your ‘lost money’.
But first you must prove that it is yours.

What is lost money in inactive accounts

Any bank, credit union or building society account that has had no transactions in the last seven years is treated as ‘inactive’ and the balance sent to the Commonwealth as ‘lost money’ in an inactive account.

Financial institutions must regularly check for inactive accounts.

Any money in a recently discovered inactive account must be paid to the Commonwealth as ‘lost money’.
Bank accounts are deemed to be ‘inactive’ if no transactions have been initiated by the owner for seven years.

If you have not withdrawn any money or deposited any cash, cheques, pension payments or received any EFT credits then your account could be ‘inactive’ according to the Commonwealth government’s definition.

An account could be ‘inactive’ while still having interest credited and bank fees deducted every year.
Your term deposit could be ‘inactive’ if you do not give a new instruction within seven years.
Lost money in inactive accounts includes bank accounts that their owners have forgotten about.

Inactive accounts with credit unions, building societies and other regulated deposit takers are treated as ‘lost money’ also.
Some unclaimed life insurance contracts which have not been claimed on maturity are labelled as ‘inactive’.

Similarly superannuation accounts could become ‘lost’ when unclaimed by retirees.

Some inactive accounts have actively interested owners

But not all inactive accounts are really ‘lost money’.

Special purpose accounts which are just rolling along closely observed by their owners could be labelled as ‘inactive’.

For example, Bob and Betty set up a savings account for each new grandchild.
These accounts could become ‘inactive’ if no additional funds are deposited into the accounts when the grandchildren are young.
Bob and Betty could help their grandchildren to become regular savers by making further deposits on each birthday.
Depositing another ten dollars into the account each birthday would prevent the grandchildren’s savings accounts from becoming ‘inactive’.

Many seniors use a separate bank account to set aside money for their funerals.
Others use an inheritance to start a side account for discretionary expenses and gifts.

These special accounts could be term deposits or another passbook savings account or more rarely, a modern online savings account.

The family could be unaware of these separate accounts which is fine until the owner becomes forgetful.

What happens to lost money in inactive accounts?

The banks, insurance companies, credit unions, building societies and any other deposit taking entities are required to transfer all lost money in ‘inactive’ accounts to the Commonwealth government.
Yes, lost money in inactive accounts becomes Commonwealth revenue.

Can lost money in inactive accounts be retrieved?

Yes, there is a bureaucratic process to prove ownership of an ‘inactive’ account and get your money back.
Your money could be returned many months after you lodge all of the ‘proofs’ required to identify yourself and establish that you are the rightful owner of the account.

Can I find out if my family has lost money in inactive accounts?

ASIC maintains a listing of Lost money in inactive accounts.
You can search the list of Lost money in inactive accounts at ASIC Find unclaimed money – Moneysmart.gov.au

Hint: Search the list using each variation of your name particularly if your family changed the spelling to shorten or anglicize their names on arrival in Australia.

Can I avoid having my bank account being sent to the Government as ‘lost money’?

You could avoid having your bank, credit union or building society account becoming ‘inactive’ by transacting on each account every year.
If you are looking at the account statement to record the interest for tax purposes and/or the balance to report to Centrelink or DVA, then deposit or withdraw something.
The amount of the transaction does not need to be substantial maybe $10 would suffice.

If you only have a passbook for that savings account then you would need to visit a bank branch to have your transactions recorded in your passbook.
Maybe you could convert that passbook into a modern account with online access.

Unclaimed superannuation accounts

Thirty years ago, employer superannuation contributions became compulsory for all adult employees earning at least $450 per month.
Back then, superannuation funds did not collect the member’s TFN as a lifetime link to each superannuation account.

Last century your employer might have paid your superannuation into the superannuation fund for that industry.
If you changed jobs you might have been enrolled in another superannuation fund.
After a few job changes you could have several small superannuation accounts.

If your TFN was recorded on your superannuation account then your account might have followed you to your next superannuation fund.
Alas, some of the early superannuation accounts might not have your TFN to transfer your balance to your new fund.
But if your account has neither TFN nor your current postal address then who could remind you of their existence.

Now that you are thinking about retirement you might like to be reunited with your superannuation accounts.

Searching for lost and unclaimed superannuation

The Australian Taxation Office is the guardian of lost and ‘unclaimed superannuation’ accounts for seniors.

You can read about the ATO superannuation lost and unclaimed superannuation records.
Keeping track of your super | Australian Taxation Office (ato.gov.au)

But searching the ATO superannuation lost and unclaimed superannuation records is via your MyGov account only

Keeping in contact with your financial assets

Updating your contact details with your bank and superannuation funds could help save your accounts from getting lost.
Not sharing your banking passwords or PINs with your extended family could reduce the risk of losing money from your accounts.
Careful reading of your bank transaction statements could alert you to unauthorised transactions.

Yes, that relative with a gambling problem could be eager to help granny with her shopping as a way to access her accounts.

Christine at Financial Care Services your independent adviser

Financial Care Services is an independent advisory service specialising in retirees of modest means and aged care entrants.
Our core values include working with clients in claiming DVA and Centrelink entitlements.

The team at Financial Care Services are here to answer your Age Pension questions and guide your understanding of aged care costs.

Help with Centrelink challenges is available from Christine Hopper at Financial Care Services, the specialist adviser to seniors in transition to new lifestyles.

Christine has neat handwriting just right for inserting your data into small printed spaces.
She helps clients complete Centrelink forms.
Christine could help you with collating your supporting documents and then mailing your form to Centrelink.

Assistance with completing Age Pension Claims and the Commonwealth aged care means testing forms is available to clients of Financial Care Services.

Christine charges fees based on the work involved in advising you about pensions and aged care fee solutions.

To make an appointment for confidential, independent and professional advice about aged care, retirement lifestyle costs, granny flat or Age Pension issues please contact Christine Hopper or call +61 3 9808 0338.
______________________________

Christine Hopper
Financial Care Services Pty Ltd
Independent aged care, strategic lifestyle and Social Security advice for seniors in Melbourne, Victoria, Australia
Telephone – call +61 3 9808 0338
Email – contact info@financialcareservices.com.au
Address – mail to 172 Warrigal Road, Camberwell Victoria 3124
Website – visit financialcareservices.com.au
LinkedIn – connect https://www.linkedin.com/in/christinehopper1
LinkedIn Company – follow https://www.linkedin.com/company/financial-care-services/
Past newsletters – see http://financialcareservices.com.au/newsletters/
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Disclaimer: The information contained in this newsletter is of a general nature only and does not constitute “financial advice”.
All eligibility for Commonwealth benefits will be determined by Centrelink or DVA, based on your personal position as documented and the legislation and Regulations in force at that time.