You can stay with TelstraSuper into retirement by opening a tax-effective RetireAccess account.
If you're considering retiring once you receive your redundancy package there are a few things to think about. Making decisions about retirement can be challenging and we’re here to support you every step of the way.
When faced with a redundancy package, many people nearing retirement age decide they will finish working. Deciding if you can retire is a big decision- there are financial and non-financial decisions to make. One of the big steps is deciding if you have enough money (see below). You may not have been thinking about retirement and now the opportunity is presenting itself with your job finishing up.
One thing to think about is your redundancy package may be taxed differently if you retire after age 65. If you’re nearing this age and can take a package before turning 65, there could be a significant difference in your final payout so it could be worth bringing forward your retirement.
The biggest question people ask is will I have enough? A redundancy payout can boost your savings but you’ll need to consider what’s left over if you have to pay off any debts before retiring. The amount of super you need in retirement depends on a range of factors including the age you plan on retiring, home ownership status, health condition and lifestyle goals.
Research done by the Association of Super Funds of Australia (ASFA) indicates that if you want to be able to afford nice clothes, travel, eat out occasionally and own a reasonable car you should aim for a “comfortable” retirement. To achieve this you’ll need around $640,000 in savings for a couple or $545,000 for an individual if you retire at age 67. If you retire earlier you’ll need to have saved more.
Our retirement lifestyle planner can show you how long your super may last in retirement and can give you an idea of how different retirement ages may affect this outcome. You also might like to consider how your super can interact with any Age Pension payment you may be eligible for.
Super is designed to support you in retirement so generally your super must stay in the system until you’re retired. There are a number of circumstances where you can access your super including if you’ve reached:
- preservation age (the age the Government allows to access super) and are retired permanently from work; or
- the age of 60 and ceased employment; or
- the age of 65 (whether you're still working or not).
There may be tax implications depending on when you take your super. TelstraSuper Financial Planning can help you work out the best time to take your super and manage your savings throughout your retirement. One option is to consider taking out an income stream. A RetireAccess account allows you to access your super through regular income payments and takes the worry out of managing your money.
How you’ll access your money in retirement is an important decision. The option you choose may affect how long your savings will last and may even have tax implications. Many people are deciding to use an income stream to fund their retirement because it provides a stable regular income. There are many benefits to using an income stream which include tax-free payments if you’re over age 60.
Before you decide what to do with your savings it’s a good idea to sit down with a financial planner. TelstraSuper Financial Planning has a team of advisers who are experts in redundancy and retirement. They can help you work out the best way to structure your savings for the long-term and help you make the important decisions.
Some of the things they can help you with are:
- Understanding your payment and how it’s taxed
- How to best use your payment (pay off debt, put it towards your mortgage, boosting your super etc.)
- Retirement planning
- Accessing your super
- Reviewing your insurance cover
- Eligibility for Centrelink payments
From simple phone-based advice about your TelstraSuper account that is included in the cost of your membership to more comprehensive advice that is competitively priced, there is an advice option to suit your needs. To speak to a TelstraSuper Financial Planning Adviser call 1300 033 166 or fill in our online form and someone will call you back.
To speak with an adviser call 1300 033 166 or request a call by filling in the online form.