Can I Get the Pension if I Have Super? Having superannuation savings does not deny you from receiving Age Pension payments. Eligibility for the Age Pension is based on an Assets Test and an Income Test.
Assume, for example, you will need 65 per cent of your pre-retirement income, so if you earn $50,000 now, you might need $32,500 in retirement.
If you leave your super in accumulation phase, you are not required to make any withdrawals from it, even if you are retired. Your accumulation balance will simply continue to be invested and (ideally) increase in value over time. Keeping your super in accumulation phase does not prevent you from accessing it.
Downsizing superannuation contributions may affect your income support payment. Before you make a decision, we recommend you either: seek professional advice.
Whether your balance is in a super account, super pension account, or bank account, it will be assessed by Centrelink. Super is not assessed for people under the age pension qualifying age.
Withdrawals are paid and taxed as a normal super lump sum. If you're: under 60, this is generally taxed between 17% and 22% over 60, you won't be taxed.
If your super provider allows it, you may be able to withdraw some or all of your super in a single payment. This payment is called a lump sum. You may be able to withdraw your super in several lump sums. However, if you ask your provider to make regular payments from your super it may be an income stream.
The impact of taking either a lump sum or pension from your superannuation account when you retire depends on your individual situation. The decision you make can affect the amount of tax you pay and also your entitlement to a government-funded Age Pension.
According to the Association of Superannuation Funds of Australia's Retirement Standard, to have a 'comfortable' retirement, single people will need $595,000 in retirement savings, and couples will need $690,000.
According to the 4% rule, if you retire with $500,000 in assets, you should be able to take $20,000/ yr for a 30-year or longer. Additionally, putting the money in an annuity will offer a guaranteed annual income of $24,688 to those retiring at 55.
How long will $800,000 last in retirement? Your money is projected to last approximately 30 years with monthly withdrawals totaling $2,024,574.
So looking at the table, you can see that a 60-year old male will need a lump sum of almost $500,000 to provide an annual income in retirement of $42,000 for 20 years. These calculations are based on a 20-year time frame because the approximate life expectancy for Australian males is 84 years and 88 for females.
Your super balance continues to grow in retirement
If you had $300,000 in super and were invested in our Balanced pension option, you would have seen average returns of 8.6% per annum over the last 10 years^. That's $25,800 per year (before fees).
The Work Bonus income bank is useful for pensioners who wish to work, particularly those who undertake intermittent or occasional work. Note: from 1 December 2022 to 31 December 2023, a one-off, temporary credit of $4,000 applies to Work Bonus income bank balances.
Once you reach age 65, you can access your Super Benefit at any time whether you have retired or not. There are absolutely no restrictions to accessing your Super Benefit when over 65. Your Super Benefit can be accessed as either a Pension or Lump Sum withdrawal.
You can access your super when you: reach your preservation age and retire. reach your preservation age and choose to begin a transition to retirement income stream while you are still working. are 65 years old (even if you have not retired).
The Bottom Line. For some, a lump-sum pension payment makes sense. For others, having less to upfront capital is better. In either case, pension payments should be used responsibility with the mindset of having these resources support you throughout your retirement.
This obviously depends on what annual income you want to fund but if you want to be able to afford a comfortable retirement—which is an income of just over $48,000 a year for a single according to the ASFA Retirement Standard—then you need a balance of at least $500,000.
You don't pay tax if you withdraw up to the 'low rate threshold', currently $230,000. If you withdraw an amount above the low rate threshold, you pay 17% tax (including the Medicare levy) or your marginal tax rate, whichever is lower.
For example, if you are under 65 years old, you can access between 4–10% of the balance of money in your super account each financial year. Once you have met a condition of release with a nil cashing restriction, you can access your super benefits in other ways and don't need a TRIS.
Should I have my super in Cash? The Cash option has a very low risk level when measured over the short term. However, if you intend to stay invested in this option for a longer timeframe, you should consider whether the current low returns will be enough for your situation.
Withdrawing Over Age 65
If you are over age 65, there is no restriction on how much super you can access, even if you are still working. Reaching age 65 is classified as a full superannuation condition of release, meaning you have full access to your super, which can be withdrawn as a lump sum or income stream.
A lump sum withdrawal is a cash payment from your super to your bank account. You can request to withdraw a lump sum if you've met certain conditions set by the Government.
Eligible applicants could be approved to withdraw up to $10,000 from their superannuation account. To be eligible, you'll need to: currently (and for the last 26 consecutive weeks) be receiving an income support payment from Centrelink or the Department of Veteran's Affairs (DVA)