Draw on superannuation before you retire!
You can start drawing on your superannuation benefit even before you retire using an Equipsuper Transition to Retirement Pension (TRP), as long as you have reached your superannuation preservation age. A TRP is often used to allow reduction of working hours while using income from super to offset the reduced salary. It can also be used in other financial strategies.
We recommend you seek professional financial advice before setting up a TRP, as there are many considerations associated with drawing superannuation payments before retirement. For example, drawing superannuation income while you're still working can reduce the amount of retirement savings you have, unless your TRP is part of a well-considered financial strategy.
You should also remember that you pay no tax on superannuation payments received after you reach age 60, while you will generally pay tax on income from super before you reach that age.
There are some rules to accessing the TRP:
- you must be between your preservation age (55 if born pre 30 June 1960) and under 65;
- you must be in gainful employment;
- the TRP is purchased with benefits in an accumulation style account, not defined benefits;
- you must draw an income at least yearly. The income amount must be no less than the prescribed minimum amount and not exceeding the prescribed maximum amount; and
- the TRP cannot be commuted (cashed in) to a lump sum, however it can be ceased at any time and rolled into another superannuation product i.e. an accumulation account.
Please refer to Fact Sheet #3a -TRPs, an income while you work or the Pensions PDS for further information. We recommend you seek financial advice before entering into a TRP. If you would like to speak to an Equipsuper Financial Planner, please call 1800 065 753.
You can download the SuperRatings Fundamentals report on our Account Based Pension here.
Watch the Activ8 your planning video for a snapshot of big ideas.
Income after retirement
Equipsuper's Account Based Pension (ABP) provides regular income payments once you have fully retired and for as long as your benefit lasts. You can set up an ABP by transferring a minimum of $25,000 from your Equipsuper benefit, or a similar amount from any super fund. You can nominate how much annual income you want to receive and how frequently.
Working out how long your benefit will last and how much income you should receive can be quite challenging. Our Super Calculator can provide you with some guidance on this. However, we strongly recommend you obtain advice from a professional financial advisor when planning your retirement.
Please refer to Fact Sheet #3 - Account Based Pensioins - an income when you retire or the Pensions PDS for further information. If you would like to speak to an Equipsuper Financial Planner, please call 1800 065 753.
Watch the Activ8 your planning video for a snapshot of big ideas.
