As you near retirement you're probably considering the different types of retirement income products (pensions) available to you. The most important decision to be made at this stage is what sort of retirement income product you want to have and what exactly are you eligible for?

Until you decide what you want to do, you may consider leaving your super inside your fund. Taking your money out of super prematurely may result in you paying unnecessary tax.

A pension is one of the ways you can turn the super you've saved into regular income payments, while remaining in the tax-effective super system.

The types of pensions we offer

1. An Account Based Pension

An Account Based Pension is aimed at those who have permanently retired, enabling you to:

• choose the amount of income you receive each year (subject to a minimum)

• vary your payments (subject to the minimum limit) to suit your lifestyle
• make withdrawals at any time.

Your pension continues until the money in your account runs out. Obviously that will depend 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.

2. A Transition to Retirement Pension

A Transition to Retirement or TTR Pension is aimed at those who have reached preservation age but have not permanently retired. It can be ideal if you want to reduce your working hours and need to use part or all of your super to supplement your income from employment. A TTR Pension enables you to:

• choose the amount of income you receive each year (subject to minimum and maximum limits); and
• vary your payments (subject to the minimum and maximum limits) to suit your lifestyle.

The benefits of a Health Super Pension

1. Can be tax effective – if you’re aged 60 or over, pension payments are tax free.  If you’re under 60, part of your pension payment may be tax free and the rest may qualify for a 15% tax offset.
2. Access to quality financial planning advice – when you invest in a Health Super Pension you’re automatically entitled to receive an annual review of your financial situation by Health Super Financial Planning.
3. A range of investment options – you can choose from one of six investment options and make up to 12 investment switches per year for free.
4. You can choose the frequency of your pension payments and when you want to receive them e.g. fortnightly, monthly or yearly.
5. Flexibility to vary your pension payment amounts (subject to minimum and/or maximum limits where appropriate) at anytime to suit your needs.
6. Lump sum withdrawal – you can access your money at any time with an Account Based Pension. Withdrawals from a TTR Pension can only be made in very limited circumstances.

For more information, please refer to the Pension Guides

What is the difference between a Health Super Pension and the Government 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, including your super.

Whereas, an account based pension is one of a number of products that you can start with your own money from a super fund to give you income during retirement. An account based pension is offered by the trustee of the super fund (not the Government).

Need help?

If you haven’t already sought professional advice in the lead up to your retirement, now would be a good time. A financial planner can provide you with personal advice on the retirement product best suited to your needs, your tax considerations and eligibility for government benefits.

Health Super Financial Planning can provide you with access to a qualified financial planner at a reduced rate. To start your retirement planning and to consider your future call Health Super Financial Planning on 1300 780 223.

Health Super Financial Services Pty Ltd ABN 37 096 452 318, AFSL 240019 trading as Health Super Financial Planning (HSFP) is wholly owned by the FSS Trustee Corporation ABN 11 118 202 672 AFSL 293340 Trustee of the First State Superannuation Scheme ABN 53 226 460 365.
The Trustee pays HSFP half of the annual 1% account-keeping fee collected on all Health Super Account Based Pensions. The Trustee also pays a variable monthly amount (calculated on a cost recovery basis) to HSFP to conduct member seminar programs. The Trustee is not a representative of HSFP and receives no commissions when making referrals to this service. To obtain further information about the services provided by HSFP, contact HSFP direct by telephoning 1300 780 223. Alternatively, visit  HSFP’s website at hsfp.com.au