Income from super
Making the most of your super
Superannuation is a major source of retirement income. Find
out how you can grow your super so you can make it
last as long as possible.
The benefits of super
One major benefit of super is that
most people pay less tax than if they had invested the money
outside super. You can also keep your money in your super fund
indefinitely and take it out as you need it. The downside of
super is that your money is generally locked away until you are
between 55 and 60.
Super changes in 2017
Changes to super contribution limits and tax concessions started
on 1 July 2017. Information about the super changes can be found on
the Australian Tax Office (ATO) website.
How to grow your super before you
If you are thinking about retiring in the next few years, here
are some things you can do to boost your super money.
- Consolidate your super - Merge your super
money into a single fund if you have more than one. See consolidating super funds for
- Find your lost super - Track down your 'lost' super by registering
for the Australian Taxation Office's online services
via myGov. See keeping track and lost
super for more information.
- Use the retirement planner - See what
income you are likely to get from your super and get some
guidance on what you can do now to improve your retirement
Find out if it's the right time for you to
How to access your super
There are a number of ways you can access your super.
Choose one or a combination of options. Keep in mind there are tax
implications associated with each option. See the ATO for details
on how your super payout is taxed or seek financial
Take some money as a lump sum
You can take a lump sum payment from your super fund when you
retire. You pay low (or no) tax on lump sums up to $205,000 or if
you are age 60 or over. This money can be put into a high-interest
bearing account (see savings accounts and term
deposits) or invested. See investments outside super for
The drawback of taking your money out of super is that you
may have to pay tax on your investment earnings.
Draw down a regular income
You can keep your money within the superannuation
system and transfer it from an accumulation
fund to an account-based
pension. This option gives you the flexibility to vary
the amount you receive each year. You won't pay tax on
investment earnings, however, the government has introduced
a transfer balance cap that limits the amount of super that can be
transferred into a retirement income stream. See
pensions for more information.
You can do this when you reach your preservation age and retire.
Your preservation age is the age you can access your super. This is
based on your date of birth and is different to the age you'll be
eligible for the Age Pension.
Find out when you can get your super and the Age
and pension age calculator
Purchase an annuity
You can buy an annuity from a super fund or life insurance
company using your super payout or other savings. This option gives
you a guaranteed income for a defined period of time or for the
rest of your life, regardless of market performance. However,
annuities are not as flexible and generally pay less than
account-based pensions. See annuities for more information.
retirement - access your super and keep working
If you're not quite ready to give up your job when you reach preservation age, you can continue to
work and draw some money from your super. You'll pay less tax on
your super income and can keep contributing to your super. See transition to retirement for
As each person's circumstances are unique, we
recommend you seek financial advice before withdrawing
your super. Otherwise you may not be able to access better options
or have to pay a tax bill. With careful thought and proper
planning, you can stretch your super money.
Last updated: 29 Aug 2018