There are lots of benefits of holding an account-based pension, but it also means you need to follow some rules. One of these rules is the amount of money you need to draw down each year.
In response to COVID-19, the Government is providing
financial assistance to support Australians in many ways. One of these measures is a reduction in minimum drawdown amounts for the 2019-20 and 2020-21 financial years. This temporary reduction in drawdown rates was introduced to benefit retirees with
account-based pensions and similar products by reducing the need to sell investment assets to fund minimum drawdown requirements.
If you currently receive the minimum annual drawdown amount, your payment in the new 2020-21 financial year will automatically be based on the new rates (which are reduced by 50% compared to the 2019-20 financial year), unless you notify your super fund to change your payment amount.
Minimum annual payments are calculated based on your account balance as at 30 June each year, multiplied by a percentage based on your age. You can calculate your minimum payment amount by using the new percentages below – but note, you’ll need to wait until your balance as at 30 June 2020 is available.
| Age | Annual min. payment as % of account balance |
| 55—64 | 2% |
| 65—74 | 2.5% |
| 75—79 | 3% |
| 80—84 | 3.5% |
| 85—89 | 4.5% |
| 90—94 | 5.5% |
| 95+ | 7% |
Source: moneysmart.gov.au