Funding your life after work

Whether you’re just starting to plan for life after work or you’ve just retired, the decisions you make now on how to turn your super into an income can have a big impact on the next stage of your life.

After years of working hard, retirement is on your radar. Or you’ve just retired and are starting to plan for this new and exciting phase of your life. Either way, you have some important decisions to make about your super nest egg.  The question—one that many of our members ask us—is ‘What happens when I retire?’ 

It’s about making smart decisions. Knowing how to make the most of your super savings could be the key to a great life after work. Here are a few options to consider. 

Access super while still working full time 

Retiring is a big step. That’s why there are special provisions that allow you to make a gradual transition, as opposed to one big leap, by granting access to super while you’re still working. This is called a transition to retirement (TTR) strategy.  

TTR helps to take charge of your super while you still have time to make a difference. With it, you can boost your super savings, pay less tax or, when you’re ready, start reducing the number of hours you work. 

Pay yourself an income in retirement 

Converting your super into a regular income through an account-based pension keeps your money working hard for you, while you take it easy. The flexibility and the tax savings attached to an account-based pension can be quite attractive. 

  • You can set up a retirement account and transfer all or part of your super savings into it.  
  • You can choose the size (minimum/maximum amounts apply) and frequency of your payments (monthly, quarterly, half-yearly or annually), plus your investment strategy. 
  • Here’s the best part—not only are the investment earnings tax free, but from age 60, you don’t have to pay tax on pension payments. 
  • Plus, this income could come on top of any Age Pension payments you’re eligible to receive. 

Take out a lump sum   

You always have the option of withdrawing all your super in one go or in tranches to spend it any way you like.  

This has its pros and cons. For example, you may finally get your dream holiday, but that big spend might put your future retirement income in jeopardy. You might want to invest the lump sum outside super, but that could mean paying more tax on your investment earnings.    

Leave it as is 

You could leave your super in an accumulation account, where investment earnings will be taxed at 15%, at least until you decide on what to do next. 

Can’t decide what to do?    

It’s normal to feel undecided and we recommend getting professional advice.  

We offer general information over the phone (at no cost to you), personal advice over the phone (again at no cost to you) and comprehensive personal advice from a qualified financial adviser (your first meeting is complimentary and after that a fee-for-service model applies). 

Discover iQ Retirement 

Retire on your terms with iQ Retirement. You can use it to pay yourself a regular income from your super savings, through a transition to retirement strategy in the years leading up to retirement and pension payments when you retire. 

To find out more, visit russellinvestments.com.au/iqretirement or call us on 1800 555 667. We’re happy to help.