There will come a time when you’re ready to slow down and gradually stop working, or stop working completely. To do either of these, it pays to be well informed of your options and financially prepared.
Ultimately, retirement from the workforce is when you should be able to sit back, enjoy life and reap the rewards from the superannuation you’ve saved.
You can generally access your super if you have reached your Preservation Age and retired from work. You have the choice of taking your super as a lump sum, as a regular pension payment or a combination of both.
Throughout your working life you’ve most likely received a regular income, so you may find it more convenient to access your super in the same way. Having a regular income will allow you to budget and manage your retirement savings more easily. MyLife MyPension offers an account based retirement pension when you’re ready to fully retire. It is designed with you in mind to help meet your retirement needs.
Pensions can be a very tax-effective way to invest your retirement savings to receive an income in retirement, as no tax is payable on the income and capital growth of your investments if you’re over age 60 and retired.
Best of all are the tax benefits that apply to both pensions. If you are 60 or over, your pension payments are tax-free. If you are under the age of 60, a portion of the payment is subject to income tax, however, a 15% tax offset generally applies.
This page will give you information about:
Learn about MyLife MyPension's account based pension products here.
Find out about the age pension and what it means in relation to your super on lifestyle choices.
Planning what happens to your estate is very important.
How MyLife MyPension can help you in retirement.
Retirement pensions from your superannuation savings are a great way to receive an income in retirement.
Once you have retired, you can invest your lump sum in a retirement pension product like MyLife MyPension and still continue the benefits of investing in an option that suits your needs.
There can be significant benefits to retirees who transfer their superannuation savings into account based pensions including:
- For people aged 60 and over, payments from a pension account are tax-free.
- If you are under 60, you are taxed at the standard tax rate but you may be eligible to receive a 15% offset.
- Flexibility in the amount of regular income you can receive each year (minimum annual pension payments apply and are set by the Government).
- Investment option/s that meet your needs.
- Ability to change amount and frequency of income payments if required and even withdraw lump sum payments to enjoy the lifestyle you have dreamed of. If you are under the age of 60 there may be tax implications.
- Centrelink benefits – pension payments are favourably treated under Centrelink’s Age Pension Income Test.
- Investment earnings within account based pensions are tax exempt.
Read more information about the retirement Pension offered by MyLife MyPension. You can also download a factsheet about this.
Starting a retirement pension
You can only start a retirement pension if you have reached your Preservation Age (refer to our Plan ahead page for more details) and meet one of the following conditions:
- You have permanently retired from the workforce,
- You are over 60 years of age and have ceased employment,
- You reach age 65 (whether you are working or not), or
- You have retired early due to disablement.
How much income can you receive from a retirement pension?
You can choose how much income you receive from your retirement pension when you start, and in each subsequent financial year. The Government has set minimum amounts that you must receive in each financial year but there is no upper limit (unless you hold a Pre-Retirement Pension).
The table below shows the minimum annual payment (a percentage of your account balance) you are generally required to draw per year, and the special arrangements that are in place for this financial year.
|
Age |
Minimum annual payment |
|---|---|
|
Under 65 |
4% |
|
65 – 74 |
5% |
|
75 – 79 |
6% |
|
80 – 84 |
7% |
|
85 – 89 |
9% |
|
90 – 94 |
11% |
|
95 & over |
14% |
Age Pension
If you have reached pension age, the Government age pension can assist in providing an adequate income in your retirement. It can supplement your super and any other investment income you may have in retirement.
It’s important to note that a retirement pension available from a super fund, such as MyLife MyPension, is different to the Age Pension you may be able to access through the Government.
As the rules around social security are complex we recommend you discuss your situation with a MyLife MyAdvice planner to ensure you are making decisions that are correct for your own circumstances. You can make a booking with a financial planner over the phone on 1300 963 720 or using an online booking form.
To be eligible for an Age Pension, you need first need to satisfy Centrelink’s age and residency requirements. Once you have satisfied those, Centrelink will use Assets and Income testing to determine the amount of Age Pension you may be eligible to receive.
Estate planning
When you die, the entire balance of your super pension will be paid out. How it is distributed will depend on whether you have made prior arrangements. There are a few factors to consider:
- When setting up a pension, you can nominate a reversionary beneficiary such as your spouse who will continue to receive the pension payments after your death.
- At any time, you can make a binding death benefit nomination to the person(s) you want your benefits to be paid to (conditions apply). Download, complete, and return the Binding Death Benefit Nomination form to make or remove a binding beneficiary nomination.
- If you do not make any beneficiary nomination, the Trustee of MyLife MyPension will decide who receives your death benefit. Generally it would be paid to your estate.
- There may be tax implications involved in the distribution of your super benefits and a MyLife MyAdvice planner can help you work out the best option.
How your assets are distributed after your death should be considered as a vital part of your financial planning strategy. It is a specialist area and we may be able to help you by recommending an estate planning specialist in your region.
We can help you
Moving from work to retirement is an exciting time, but it can also be daunting when you think about the financial implications of doing so.
Having a solid understanding of your financial position and a clear, well planned retirement strategy in place can help alleviate some of the concerns about supporting yourself in retirement.
At MyLife MyPension we want to make it as easy and as seamless as possible for you. We have a number of resources to help you plan your retirement:
- Contact our Service Centre on 1300 963 720, or refer to details on our Contact us page.
- Refer to the information about pensions and investments on this website, and download a factsheet.
- Use our calculators to help guide you through scenarios to help you make the most of your superannuation and retirement.
- Call us on 1300 963 720 or book an appointment online to meet with a MyLife MyAdvice financial planner.
At MyLife MyPension, we put our members first. We are committed to making your secure retirement a reality by providing great value products.
We understand the importance of retirement planning at the stage of your life where you have to rely on your superannuation money. Our Service Centre team looks after the needs of our pension members and anyone who contacts us about pensions.
With over 45 years of experience in superannuation, our fund’s award-winning super and pension products have helped many members save for their retirement MyLife MyPension has a history of strong, responsible investments and low fees, with all profits benefiting members.
The following information can help you build your super and plan for the retirement you want: