Choose a pre retirement pension to boost your super
Check if a pre retirement pension is right for you
Financial advice about pre retirement pensions from Mine Wealth + Wellbeing Financial Advice starts from just $550. Call 13 MINE (13 64 63) to make an appointment with a financial adviser.
Apply for a pre retirement pension
Increase your before tax super contributions
Ask your employer to increase your before tax super contributions. To do this, you can give them our Authority to Deduct from My Pay form.
If you’re under age 65 and have reached preservation age, with at least $15,000 to invest, you can transition to retirement to boost your super for a comfortable retirement.
The transition to retirement strategy allows you to continue working full time while increasing your before-tax super contributions up to $25,000 and supplementing your income with a pre-retirement pension.
By changing how you receive your income, you can generally reduce your marginal tax rate to 15%. Typically, this option is of greatest benefit to people who are age 60 or over on a high marginal tax rate.
Doing the maths - Contribute more to super and maintain the same income!
Fred is 60 years old and earns $100,000 pa. He pays $26,632 in income tax for 2017-18, including Medicare Levy, leaving him with $73,368.
Fred can contribute up to $15,500 pa before-tax to super, in addition to the compulsory 9.5% contribution his employer makes for him. He decides to contribute the full amount, reducing his taxable income to $84,500. This means he only pays $20,699.50 income tax. At the same time, Fred takes out a pre-retirement pension and draws $9,567 from his pension to maintain his lifestyle. As Fred is over age 60, his pension payments are tax free*.
This leaves Fred with $3,608.00 pa extra in his super after receiving his pension payments, without having to compromise his lifestyle.