Retirement Income Streams

October 20 2017

A Retirement Income Stream allows you to convert your lump sum superannuation benefits into a flexible income stream to suit your lifestyle in retirement. We've designed this solution especially for ESSSuper members - so you can stay with the organisation you trust once you've finished working.


What is a Retirement Income Stream, and how does it work?

A Retirement Income Stream allows you to convert your lump sum superannuation benefits into a flexible income stream to suit your lifestyle in retirement. We've designed this solution especially for ESSSuper members - so you can stay with the organisation you trust once you've finished working.

You can choose how much you receive and how often you'd like to receive your regular payments.

To create a Retirement Income Stream, you simply roll over a superannuation lump sum into a Retirement Income Stream.

If you have money invested in other super funds or wish to make a personal contribution to your super, you may wish to consolidate all of this into one, easy to manage account - that could save you fees and paperwork. You can then roll over all or part of your balance into a Retirement Income Stream.1

If you find that you require more income, your funds are running out, or you have another lump sum you would like to convert, you can open another Retirement Income Stream which will run alongside your existing one. Government legislation doesn't allow you to top-up your existing retirement income stream. If you are in this situation, contact us to discuss your options.

Once your Retirement Income Stream is in place, the balance will be affected in a number of ways:

  1. Investment returns will either add to, or subtract from your balance, depending on the market.
  2. Fees and other costs will also be deducted from your balance.
  3. The bulk of your funds are likely to go towards the regular payment into your bank account, or any lump sum withdrawals you make.

Payments will continue to be made until your account balance is exhausted. Before you begin your Retirement Income Stream, you should consider:

  • your financial needs in retirement
  • your balance
  • tax benefits and disadvantages
  • other income

 


1. You should check any relevant exit fees you may incur, or any insurance arrangements that may be forfeited, or any other effects this transfer may have on your benefits, before rolling your money into our fund.

Why choose an ESSSuper Retirement Income Stream?

The Retirement Income Stream is an easy and convenient way to continue your membership with ESSSuper when you retire:

  • There is no tax payable on any investment earnings in your account up to the transfer balance cap (see Tax & Super).
  • If you are 60 years of age or over, all pension payments are tax free.
  • If you are between your preservation age and age 60,any pension payments received (other than any tax free component) is taxable, but a 15% tax offset may reduce any tax liability you may have on this (and other) income.
  • You can choose up to ten investment options which range from shares to cash. You can also select a term deposit2 option for a fixed investment return. You choose the mix that suits your circumstances.
  • You can withdraw lump sums as required but these are taxed as pension income payments for taxation purposes.
  • You can choose the frequency of payments.
  • The opportunity to invest in an income stream product with a SuperRatings “Platinum” rating – the highest industry rating3.
  • You can select the level of income you need, however there are minimum amounts prescribed that you must take each year.

2. Term deposits are ‘locked in’ for the term of the investment. Any income payments must be drawn from the other investments in your account.

3. Superannuation research and rating organisation SuperRatings, has given our Accumulation Plan and Income Stream products a Platinum rating (the highest rating possible) for 7 and 9 years respectively. Check out our SuperRatings report at www.esssuper.com.au/SuperRatings.

 

 

How do we rate?

A "best value for money" fund. Well balanced across all key assessment criteria in a robust, secure and proven risk framework. The fund provides features that should assist most individuals to meet their retirement goals.

- SuperRatings Assessment

For the eighth consecutive year, independent superannuation research and rating organisation, SuperRatings, has given our Retirement Income Stream a Platinum rating (the highest rating possible).

SuperRatings logo blue  logo-platnium-pension2016.png  SuperRatings 7yr platinum performance

Read the report (PDF 227.8KB)

SuperRatings is an independently owned superannuation research company providing data analysis, information and commentary to both the public and the superannuation industry. Established in 2002, it is the most widely used and accepted ratings firm in the superannuation industry. Refer to www.superratings.com.au for more information.

 

How might it work for you?

Retirement Income Stream factsheet (PDF 12.8KB)

 


Before making any decisions about ESSSuper products or services, you should read the applicable PDS or Handbook. You can access all of our publications here.