Superannuation Discussion + market volatility

[Jacques Vert]

Until then, if you leave your employment or "retire", since you are over 60 you can access part of or your entire balance and pay off any debt as a lump sum. (It does not matter if you find gainful employment somewhere.

To add to that, last time I checked , you didn't have to retire from your main job , just cease an employment contract . Many get around this by working on election day. You sign a contract , do the day's work and your contract has finished . Box ticked.

But make sure you check this with an adviser and/or your accountant. The above is not financial advice .

 

[QF WP]

Note at 65 years old the TTR transitions back to allocated pension and tax on earnings will be back the same as accumulation phase.

Have appointment with financial planner next Monday.

@JohnK, once an account moves from either super to account based (allocated pension) or from TtR AP to retirement AP, then tax on earnings are zero.

From moneysmart.com.au:

• Transition to Retirement (TTR) Pension (Age 60+): Regular payments are tax-free, but investment earnings in the fund are taxed at up to 15%. You cannot take lump sum withdrawals, and payments are capped at 10% of the balance annually.
• Allocated Pension / Account-Based Pension (Age 60+): Income payments are tax-free, and investment earnings within the fund are also tax-free.
• Under Age 60: TTR and pension payments are taxed at your marginal rate less a 15% tax offset.
• TTR to Account-Based Pension: Once you turn 65 or declare full retirement, a TTR account converts to an account-based pension, making investment earnings tax-free

 

[JohnK]

If you have any debts still costing you interest at the age of 65 it makes good sense to eliminate the debts completely. It is unlikely returns on an income stream would be greater than the cost any interest.

Good advice. Debt will be close to wiped out soon.

You should be able to find advisers who will provide initial consultations without a fee. Have you asked your current superfund if they have such a service?

I have set up free meeting with Insignia Financial next Monday.

I know I want TTR. I'm curious if anyone thinks it's a bad idea or has other advice.

 

[OATEK]

Good advice. Debt will be close to wiped out soon.



I have set up free meeting with Insignia Financial next Monday.

I know I want TTR. I'm curious if anyone thinks it's a bad idea or has other advice.

I used TTR for 3 years to cut back work hours from 5dpw to 3 dpw. I found the time that gave me was valuable both for preparing for retirement, and for time with family (esp grandchildren).

 

[Quickstatus]

I'm curious if anyone thinks it's a bad idea or has other advice.

Whether it's a bad idea depends on personal circumstances. It's your money. The downside is you are accessing super earlier and reducing the compound interest potential. The upside is you can be less financially stressed

 

[Hollywood100]

Apologies, I am not asking for free advice just thoughts. If I am not mistaken I can set up free meeting with ANZ super.

I am now 62 years old and want to transfer around $250,000 into a TTR. I believe the fund earnings are taxed at 15% but if I withdraw 10% a year as regular income stream there is no tax even though I am working?

Plans are to keep working until at least 70 years old but the TTR can help me reduce some of my debt which is hurting. At the same time I can increase my regular super savings to ~$30,000 saving some income tax as well?

Thoughts?

Hi John,
Yes, you are correct, your TTR pension will still be taxed like a super fund at 15% but the pension you receive is tax free and not included in your taxable income. I assume you need this income to assist with your living costs otherwise I wouldn't be drawing down until retirement, oh and you can consider the cessation of any gainful employment since turning 60 strategy in order to unlock all of your super at that time of the declaration to then be able to start a ABP(account based pension) which is all tax free on earnings and tax free pension, speak to your adviser. Also do a health check on your super fund regarding fees etc as there are more cost effective options available nowadays eg Vanguard Super referring to the barefoot Investor (Scott Pape) and his wonderful articles.

 

[CaptJCool]

Time is the only resource you cannot get back.

I quit work at 53 360 days
Had a tide over year while still having a mortgage
Then onto a fairly fully taxed Comm govt pension until 59. From there tax concessions happened at 59 & 60

It’s a joy to live life fully free from work. Especially from stupid people, those who hardly work, and bosses

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