A pension is a stream of payments that provide a source of regular income to the recipient. Depending on your super balance, when you reach your preservation age and retire, or reach age 65 regardless of whether you are retired or not, you may be able to receive a pension (i.e. draw out a regular income stream) from your super account. Superannuation pensions are also called account-based pensions, income streams and income accounts, and include Sunsuper’s Transition to Retirement and Retirement Income Accounts. Government pensions include the age pension, which is a safety net for Australians who can’t fund their own retirement, as well as disability support pensions for people who have a disability that affects their ability to work, and defence force pensions for people who have been injured or died while serving in the defence force.
The pension rate for the government age pension is set by the government and aims to cover recipients’ basic living expenses. The rate of payment for a superannuation account-based pension or Income Account will depend on your superannuation balance and how long you plan to draw a regular income from your super account. The government also sets some rules around the minimum percentage payment rates you need to withdraw from your super Income Account. These percentage payment rates increase as you get older. If you are 60 years or older payments from your Income
A superannuation pension or Income Account is an account-based pension, and was formerly also called an allocated pension. It is a stream of payments that you withdraw from your super account to provide a source of regular income in retirement. To start an allocated pension from your super you generally need to reach your preservation age and retire, or reach age 65 regardless of whether you are retired or not. The government sets rules around the minimum percentage payment rates you need to withdraw from your Income Account. These percentage payment rates increase as you get older. If you are 60 years or older payments from your Income Account are tax free.
Depending on your super balance, when you reach age 60 and retire or reach age 65 regardless of whether you are retired or not you may be able to draw an income from your super account through an Income Account, also called a superannuation pension, account-based pensions or income streams and income accounts.
An annuity is also called a lifetime or fixed-term pension. You can buy an annuity from a range of financial services companies, including banks. An annuity guarantees a fixed payment amount per year for the rest of your life, up to your life expectancy or for a certain number of years. Payments can be made monthly, quarterly, six-monthly or annually. Unlike drawing an income through an Income Account from your superannuation, the remaining balance in your annuity doesn’t earn you investment returns. So, while an annuity may give you a worry-free income stream because it isn’t linked to share market returns, there is no opportunity for the balance to increase as a result of positive investment returns.