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Transition To Retirement
Transition To Retirement

Transition To Retirement

How do I move from working full time to retirement?

With a transition to retirement plan.

Energy Super provides a range of tools, advice and services to help you make informed and financially sound decisions about your retirement. So you can make your retirement goals a reality.

What is a Transition to Retirement income stream?

An Energy Super Transition to Retirement Income Stream allows you to access some of your superannuation while you keep working and transition to retirement. You receive regular income payments from your super, which allows you to reduce your working hours, or salary sacrifice more of your salary into super, without having to forfeit your income.

A Transition to Retirement income stream is available once you reach your preservation age.

You should get advice from a licensed financial adviser before you start a transition to retirement strategy. Energy Super's financial advisers can provide members with comprehensive financial advice at an agreed fee.

How does a Transition to Retirement income stream work?

The income stream is set up by transferring a sum from a superannuation account into an income stream account. Regular payments are made from this income stream account to give you an income.

The amount you receive, the frequency of the payments (fortnightly, monthly, quarterly, etc.), and how long you receive payments, depend on the amount that you use to open the account.

What are the benefits?

There are many benefits of taking up a Transition to Retirement Income Stream – it depends on your individual circumstances.

Reduce your working hours without reducing your income

You can use Transition to Retirement Income Stream payments to provide extra income if your work income isn’t enough to meet your living expenses. If you’ve decided to reduce your working hours in preparation for retirement, Transition to Retirement Income Stream payments can help cover the gap between your new work income and your required income.

Increase your tax savings

Income stream payments and before-tax payments to your super are generally taxed at a lower rate than your salary. If you reduce your taxable salary by salary sacrificing more into super, and replace the lost income with payments from an income stream, you may have more tax savings.

Increase your retirement savings

Receiving concessionally taxed income from your super may mean you can afford to make greater contributions to your super account by salary sacrificing. Depending on your personal situation, combining salary sacrifice super contributions with a Transition to Retirement Income Stream can be a tax effective retirement savings strategy.

A snapshot of your Energy Super Transition to Retirement Income Stream

Who can invest?

You can if you have a super benefit of at least $10,000 and have reached your preservation age.

Why would you invest?

You:

Have reached your preservation age

Want to reduce your working hours but not retire

Want to supplement your full time or part time income with payments from your super

Want flexibility in the income you receive each year

Want to structure a tax effective income source

Choosing your income

You choose how much income you receive each year, subject to a minimum and maximum legislated amount. The minimum is calculated in the same way as the 'retirement' income stream.

Lump sum withdrawals

Lump sum withdrawals are generally not permitted. However, if you satisfy a condition of release you can transfer your Energy Super Transition to Retirement Income Stream to an Energy Super Income Stream.

Lump sum withdrawal fee

$65 to close your account.

Contributions

Once started you can't make additional contributions to your Transition to Retirement Income Stream, but you can open a second account with a minimum contribution of $10,000.

Frequency of payments

You can choose from four regular payment frequency options:

Fortnightly

Monthly

Quarterly

Half yearly

Annually

We'll write to you every July asking you to select your preferred payment option for that financial year. If you have nominated to have your Energy Super Income Stream payments made monthly, quarterly, half-yearly or annually, payments will be processed in time to be credited to your bank or other financial institution around the 24th of each payment month (if applicable). If you have nominated to have your Income Stream payments made fortnightly, payments will be processed in time to be credited to your bank or other financial institution every second Wednesday.

How long will your income stream last

Your income stream doesn't have a fixed term so it will last as long as there is enough money in your account.

Investment choice

You can choose any combination of the 9 available investment options for your income stream account.

Tax

Tax free if you are over 60. If you’re under age 60 tax is charged at your marginal tax rate with a 15% tax offset available if you're aged between 55 and 59.

Death benefits

You can nominate a dependant as your Reversionary Beneficiary when you start your Energy Super Income Stream. This means should you die with money in your account, your Reversionary Beneficiary will continue to receive your income stream. If you choose not to name a Reversionary Beneficiary you can nominate dependants as recipients of your account balance as a lump sum death benefit.

Download our Income Stream PDS

Speak to one of our Financial Advisers

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