{"id":4487,"date":"2021-01-03T12:05:40","date_gmt":"2021-01-03T01:35:40","guid":{"rendered":"https:\/\/adelaideprivatewealth.com.au\/transition-to-retirement-access-your-super-while-you-keep-working\/"},"modified":"2021-01-03T12:05:40","modified_gmt":"2021-01-03T01:35:40","slug":"transition-to-retirement-access-your-super-while-you-keep-working","status":"publish","type":"post","link":"https:\/\/adelaideprivatewealth.com.au\/transition-to-retirement-access-your-super-while-you-keep-working\/","title":{"rendered":"Transition to retirement: Access your super while you keep working"},"content":{"rendered":"<div>\n<p>A &#8216;transition to retirement&#8217; (TTR) strategy lets you access some of your super and keep working.<\/p>\n<p>Setting this up can be complicated, so contact your super fund or financial adviser for advice.<\/p>\n<h3>How transition to retirement works<\/h3>\n<p>If you&#8217;re aged 55 to 60 and still working, you can use a TTR strategy to:<\/p>\n<ul>\n<li>\n<p>supplement your income if you reduce your work hours, or<\/p>\n<\/li>\n<li>\n<p>boost your super and save on tax while you keep working full time<\/p>\n<\/li>\n<\/ul>\n<h3>Starting a TTR pension<\/h3>\n<p>You can start a TTR pension by transferring some of your super to an\u00a0<a href=\"https:\/\/moneysmart.gov.au\/retirement-income\/account-based-pensions\" target=\"_blank\" rel=\"noopener noreferrer\">account-based pension<\/a>.<\/p>\n<p>You need to keep some money in your super account to continue to receive your employer\u2019s compulsory contributions. Or any voluntary contributions you make.<\/p>\n<h3>Government benefits and TTR<\/h3>\n<p>Starting a TTR pension may impact your or your partner&#8217;s government benefits. Speak to a Services Australia\u00a0<a class=\"external-link\" href=\"https:\/\/www.humanservices.gov.au\/individuals\/services\/financial-information-service\" target=\"_blank\" rel=\"noopener noreferrer\">Financial Information Service (FIS)<\/a>\u00a0officer for more information.<\/p>\n<h3>Life insurance and TTR<\/h3>\n<p>You may have life insurance with your super. Check if your cover reduces or stops if you start a TTR pension.<\/p>\n<h3>Using TTR to reduce work hours<\/h3>\n<p>If you want to reduce your work hours, a TTR strategy can top up your income.<\/p>\n<h3>Pros<\/h3>\n<ul>\n<li>\n<p><strong>Continue to receive super contributions<\/strong>\u00a0\u2014 This helps to replace the money you take out.<\/p>\n<\/li>\n<li>\n<p><strong>Pay less tax<\/strong>\u00a0\u2014 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.<\/p>\n<\/li>\n<li>\n<p><strong>Ease into retirement<\/strong>\u00a0\u2014 You can start planning what you&#8217;ll do with your leisure time before you retire completely.<\/p>\n<\/li>\n<\/ul>\n<h3>Cons<\/h3>\n<ul>\n<li>\n<p><strong>Affects retirement income<\/strong>\u00a0\u2014 If you start drawing down your super early, you&#8217;ll have less money when you retire.<\/p>\n<\/li>\n<\/ul>\n<h3>Case Study\u00a0<\/h3>\n<p class=\"caseStudyTitle\">Alisha reduces her work hours<\/p>\n<div>\n<p>Alisha has just turned 60 and currently earns $50,000 a year before tax. She decides to ease into retirement by reducing her work to three days a week. This means her income will drop to $30,000. Alisha transfers $155,000 of her super to a transition to retirement pension and withdraws $9,000 each year, tax-free. This replaces some of her lost pay.<\/p>\n<h3 id=\"jumpAnchor2\">Using TTR to save on tax<\/h3>\n<p>You can use a TTR pension to grow your super and pay less tax in the lead up to retirement.<\/p>\n<p>This strategy works best if you are 60 or older and a mid to upper income earner.<\/p>\n<h3>Pros<\/h3>\n<ul>\n<li>\n<p><strong>Boost your super<\/strong>\u00a0\u2014 A TTR pension can be used with\u00a0salary sacrificing\u00a0to top up your super as you approach retirement.<\/p>\n<\/li>\n<li>\n<p><strong>Save tax<\/strong>\u00a0\u2014 You pay 15% tax on salary sacrificed contributions. This is likely to be lower than your marginal tax rate.<\/p>\n<\/li>\n<li>\n<p><strong>Pay less tax on income<\/strong>\u00a0\u2014 If you are age 60 or older, your TTR pension payments are tax free. If you are 55 to 59 you are taxed at your marginal tax rate, but you get a 15% tax offset.<\/p>\n<\/li>\n<\/ul>\n<h3>Cons<\/h3>\n<ul>\n<li>\n<p><strong>Complexity<\/strong>\u00a0\u2014 You may need to pay for financial advice to understand if this strategy is for you.<\/p>\n<\/li>\n<\/ul>\n<h3 class=\"caseStudy\">\u00a0<img loading=\"lazy\" decoding=\"async\" alt=\"\" height=\"300\" src=\"http:\/\/internal.clientcommunity.com.au\/uploaded\/level\/2063\/olderman.jpg\" width=\"570\">\u00a0<\/h3>\n<h3 class=\"caseStudy\">Case Study\u00a0<\/h3>\n<p class=\"caseStudyTitle\">Kyle reduces his tax<\/p>\n<div>\n<p>Kyle is 60 and earns $100,000 a year. He intends to keep working full-time for at least another five years. Kyle transfers $200,000 from his super to an account-based pension so he can start a TTR strategy.<\/p>\n<p>He salary sacrifices into his super. This will reduce his income tax, but also his take-home pay. He tops up his income by withdrawing up to 10% of his TTR pension balance each year.<\/p>\n<p>Please contact us on |PHONE| if you seek further assistance on this topic.<\/p>\n<p><span style=\"font-size: 10px;\"><a href=\"https:\/\/moneysmart.gov.au\/retirement-income\/transition-to-retirement\" target=\"_blank\" rel=\"noopener noreferrer\">Source : Moneysmart .gov.au December 2020\u00a0<\/a><\/span><\/p>\n<p><span style=\"font-size: 10px;\">Reproduced with the permission of ASIC\u2019s MoneySmart Team. This article was originally published at\u00a0https:\/\/moneysmart.gov.au\/retirement-income\/transition-to-retirement<\/span><\/p>\n<p><span style=\"font-size: 10px;\">Important note: This provides general information and hasn\u2019t taken your circumstances into account.\u00a0 It\u2019s important to consider your particular circumstances before deciding what\u2019s right for you. Although the information is from sources considered reliable, we do not guarantee that it is accurate or complete.\u00a0You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, we do not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.\u00a0 Past performance is not a reliable guide to future returns.<\/span><\/p>\n<p><span style=\"font-size: 10px;\">Important Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business nor our Licensee takes any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents\/information contained within the linked site(s) accessible from this page. <\/span><\/p>\n<p><span style=\"font-family: Roboto, RobotoDraft, Helvetica, Arial, sans-serif; font-size: 13px; white-space: pre-wrap;\">\u00a0<\/span><\/p>\n<\/p><\/div>\n<\/p><\/div>\n<\/div>\n<p class=\"wpematico_credit\"><small>Powered by <a href=\"http:\/\/www.wpematico.com\" target=\"_blank\" rel=\"noopener noreferrer\">WPeMatico<\/a><\/small><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A &#8216;transition to retirement&#8217; (TTR) strategy lets you access some of your super and keep working. Setting this up can&#8230;<\/p>\n","protected":false},"author":3,"featured_media":4488,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[15],"tags":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Transition to retirement: Access your super while you keep working - Adelaide Private Wealth<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/adelaideprivatewealth.com.au\/transition-to-retirement-access-your-super-while-you-keep-working\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/adelaideprivatewealth.com.au\/transition-to-retirement-access-your-super-while-you-keep-working\/\",\"url\":\"https:\/\/adelaideprivatewealth.com.au\/transition-to-retirement-access-your-super-while-you-keep-working\/\",\"name\":\"Transition to retirement: Access your super while you keep working - 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