Properly restructuring your assets before retirement can extend the longevity of your capital, reduce tax liabilities, and provide a reliable, inflation-adjusted income stream for the rest of your life.
Maximising Your Superannuation Balance
The decade preceding retirement is the most critical phase for wealth accumulation.
During this window, individuals typically reach their peak earning capacity while simultaneously reducing their household debt, freeing up cash flow for aggressive superannuation contributions.
Concessional and Non-Concessional Contributions
A strategic planner will utilise your concessional (before-tax) contribution caps.
By salary sacrificing a portion of your income into superannuation, the funds are taxed at a maximum rate of 15%, which is significantly lower than most individuals' marginal income tax rates.
For those who have received an inheritance or sold a large asset (such as an agricultural property in the Goulburn Valley), planners will carefully orchestrate non-concessional (after-tax) contributions, ensuring you do not breach the strict limits and trigger severe ATO penalty taxes.
Transition to Retirement and Pension Phases
Reaching your preservation age (which is 60 for most Australians) triggers access to specific retirement strategies that drastically alter how your investments are taxed.
Transition to Retirement (TTR) Strategy
A TTR strategy allows you to access a portion of your superannuation via an income stream while you are still working.
When combined with salary sacrificing, this allows you to maintain your current take-home pay while funnelling highly taxed wages into your lower-taxed super environment, rapidly accelerating your wealth accumulation in your final working years.
The Account-Based Pension (ABP)
Once you formally retire and meet a condition of release, a financial planner will transfer your accumulated superannuation from the "accumulation phase" into the "pension phase" by establishing an Account-Based Pension. In the pension phase, all investment earnings, capital gains, and income drawn from the fund are completely tax-free.
Authoritative Superannuation & Retirement Resources
- Services Australia (Centrelink): servicesaustralia.gov.au
- Moneysmart (ASIC): moneysmart.gov.au
- Australian Taxation Office (ATO): ato.gov.au
Frequently Asked Questions
What is the preservation age for superannuation?
For anyone born after 1 July 1964, the preservation age—the age at which you can legally access your superannuation funds provided you meet a condition of release—is 60 years old.
What is the difference between concessional and non-concessional contributions?
Concessional contributions are made before tax (like employer guarantee payments and salary sacrifice) and are taxed at 15% inside the fund.
Non-concessional contributions are made using your after-tax personal savings and are not taxed upon entry into the fund.
What is a Transition to Retirement (TTR) pension?
A TTR pension allows individuals who have reached their preservation age to access up to 10% of their superannuation balance each year as an income stream, even if they are still working full-time or part-time.
Are withdrawals from my super fund taxed after I retire?
If you are over the age of 60 and have formally retired, all lump sum withdrawals and regular pension payments drawn from a taxed superannuation fund are completely tax-free.
Can a financial planner help me get the Centrelink Age Pension?
Yes. Planners specialise in structuring your assets and income streams to legally maximise your entitlements under Centrelink’s strict income and assets tests.
How much super do I need to retire comfortably in Australia?
The Association of Superannuation Funds of Australia (ASFA) currently estimates that a couple requires approximately $690,000, and a single person requires $595,000, to fund a comfortable lifestyle in retirement.
What happens to my superannuation when I die?
Superannuation does not automatically form part of your estate or Will.
You must establish a Binding Death Benefit Nomination with your super fund to legally direct the payout to your specified beneficiaries.
Can I have multiple superannuation accounts?
While you can hold multiple accounts, it is highly detrimental due to duplicate administration fees and insurance premiums eroding your balance.
A planner will help consolidate your funds into a single, high-performing account.
"This information is of a general nature only and should not be regarded as specific to any particular situation. Readers are encouraged to seek appropriate professional advice based on their personal circumstances. This is content submitted by a third party. It does not necessarily represent the views of the publisher of this website."
