We offer super accounts and pension accounts.
Super accounts are used during your working life to build investments to support you in retirement.
Pension accounts can be used when you retire (or reach preservation age) to provide an income from your super investment.
We have two types of super accounts:
- Accumulation
- Defined benefit.
Super accounts
In the case of Accumulation accounts, contributions are paid into an individual account for each member. The contributions are invested, for example in the stock market, and the returns on the investment (which may be positive or negative) are allocated to each member’s account after taking into account relevant fees, costs, insurance and premiums and tax.
On retirement, the member's account is used to provide retirement benefits, often through a lump sum or the purchase of a pension which then provides a regular income.
An Accumulation account will provide a payout at retirement that is dependent upon the amount of money contributed and the performance of the investment vehicles utilised. Your retirement benefit depends on how much super you accumulate over your working life, which is the money paid into your account and any investment earnings, less deductions for expenses and taxes.
Defined Benefit (DB) account
Please note that accounts in Health Super’s DB scheme are no longer available for new members. Only members with existing DB accounts can access this account type. However, if you joined the Fund prior to 1 January 1994, you may be able to apply to enter the DB scheme.
A DB account provides a benefit based on a formula which usually depends on your salary, your rate of contribution and the number of years' membership in the scheme. These types of accounts are most common in the public and corporate sector but are less common than accumulation accounts.
Funding of the DB scheme
Defined benefit schemes may be either funded or unfunded. Health Super’s DB scheme is fully funded.
In a funded scheme, contributions from the employer, and sometimes also from scheme members, are invested in a pool towards meeting the defined benefits. The future returns on the investments, and the future benefits to be paid, are not known in advance, so there is no guarantee that a given level of contributions will be enough to meet the benefits payable.
Typically, the contributions to be paid by the employer are regularly reviewed in a valuation of the scheme’s assets and liabilities, carried out by an actuary to ensure future benefit payment obligations will be met.
We’ve included more information on the Health Super DB ‘Post Account’ and the Health Super DB ‘Pre Account’ in our publications area. The DB scheme can be complex so if you need further assistance - please call us on 1800 331 719.
Pension accounts
A pension is one of the ways you can turn the super you’ve saved into regular income payments. We have two types of pension accounts:
- Account Based Pension
- Transition to Retirement (TTR) Pension.
Account Based Pension:
This pension is designed for those who have permanently retired or satisfied some other condition of release (e.g. reaching age 66), enabling you to:
- choose the amount of income you receive each year (subject to a prescribed minimum)
- vary your payments (subject to the prescribed minimum) to suit your lifestyle
- make lump sum withdrawals at any time.
It will continue until the money in your account runs out.
The duration of the pension depends on many factors, including the amount of your pension payments, frequency of payments, the investment option you choose (and its investment performance), and any additional withdrawals you make as well as fees and costs.
In the Pension Guide, you can find out more about the conditions and the benefits before deciding whether to acquire a Pension.
Transition to Retirement or TTR Pension:
This pension is aimed at those who have reached preservation age, allowing you to access your super before retirement. It’s ideal if you want to reduce your working hours and need to use part, or all of your super to supplement your income. A TTR Pension enables you to:
- choose the amount of income you receive each year (subject to the prescribed minimum/maximum limits)
- vary your payments (subject to the prescribed minimum/maximum limits) to suit your lifestyle.
In the TTR Pension Guide, you can find out more about the conditions and the benefits before deciding whether to acquire a TTR Pension.
What is the difference between a Health Super Pension and the Government aged pension?
The Federal Government provides an Age Pension for those people who have reached retirement age. Your eligibility for this pension and the amount you’ll receive is determined by your age, any other income as well as the value of your assets. The Age Pension is paid until you die.
Whereas, an account based pension (previously called an allocated pension) or TTR pension is one of a number of products that you can purchase with your own money from a super fund to give you income during retirement. An account based pension or TTR pension is offered by the trustee of the super fund (not the Government). An account based pension or TTR pension is paid until your pension account balance runs out.
