Financial Planning : What Is A Transition To Retirement Pension Strategy ?
Click on the image below to read our latest article that discusses the option of easing into retirement using what is known as a “Transition To Retirement (TTR)” pension strategy.
What is a “transition to retirement (TTR) strategy” ?
This strategy lets you access some of your super and keep working. Setting this up can be complicated, so using an Experien Financial Services financial adviser for advice is something to consider.
Broadly, if you’ve reached your “preservation age” (between 55 and 60 depending on a few factors) and still working, you can use a TTR strategy to:
- supplement your income if you reduce your work hours, or
- boost your super and save on tax while you keep working full time
You can start a TTR pension by transferring some of your super to an account-based pension.
You need to keep some money in your super account to continue to receive your employer’s compulsory contributions. Or any voluntary contributions you make.
Government benefits and TTR
Starting a TTR pension may impact your or your partner’s government benefits. You Speak to a Services Australia Financial Information Service (FIS) officer for more information.
There are a few Pros and Cons to this strategy. For example
- Pro :If you are 60 or older, your TTR pension payments are tax free. If you are 55 to 59, your pension is taxed at your marginal tax rate, but you get a 15% tax offset.
- Con : If you start drawing down your super early, you’ll have less money when you retire.
This is general information. Each person has different needs so contact us today to find out more and to see how it may apply to you.
Click here to get in touch to book a free introductory consultation. Or contact us on 1300 417 020.
Life insurance and Financial Advice services are provided by Experien Insurance Services Pty Ltd (EIS) ABN 99 128 678 937 and Experien Financial Services Pty Ltd (EFS) ABN 32 631 346 757. EIS and EFS are a Corporate Authorised Representative (No. 320626 and No. 1274354) of Affinia Financial Advisers Limited ABN 13 085 335 397 AFSL No. 237857.
