WHAT IS THE TRANSITION TO RETIREMENT PENSION?
If you’re between 55 and 65, employed, but considering retirement, a Transition to Retirement Pension can make a big difference to your super. It may improve your tax position and, if set up right, maintain your current level of income.
How does it work?
You can reduce your working hours but draw down a pension from your super fund in order to supplement your wage. You can also make salary sacrificed contributions back into your superannuation. These payments are taxed at a lower rate than your usual tax rate.
How much you can salary sacrifice will depend on how much you're earning. A variety of transition to retirement strategies can be built for you according to your income needs and whether you can afford to reduce your annual income and thereby increase your super savings.
Find out more with our superannuation FAQs