What are the options for accessing my superannuation in retirement?

Reaching the Threshold: Preservation Age

The Australian government dictates a minimum age, known as the preservation age, before you can access your super for retirement purposes. This age varies depending on your date of birth:

  • Those born before July 1, 1954, can access their super at 55.
  • For individuals born between July 1, 1954, and June 30, 1956, the preservation age increases gradually.
  • Everyone born after June 30, 1956, needs to wait until they reach 60 to access their super.

Unlocking Your Super: Lump Sum or Income Stream?

Once you’ve reached your preservation age, you have two primary choices for accessing your super:

  • Lump Sum: This option involves receiving the entire balance of your superannuation savings in one go. This large sum can be deposited into your bank account or used to invest in other financial products.
  • Retirement Income Stream (RIS): An RIS provides you with a steady stream of income payments throughout your retirement. These payments can be structured as account-based pensions (ABPs) or lifetime income streams (LIS). ABPs are generally taxed at a lower rate than lump sums, while LIS offer the advantage of guaranteed income for life, even if your super balance runs out.

Choosing the Right Option: Factors to Consider

The decision between a lump sum and an RIS hinges on several factors, including:

  • Your risk tolerance: A lump sum offers more control over your finances but exposes you to investment risks. An RIS provides a guaranteed income but limits your flexibility.
  • Retirement lifestyle: Consider your desired spending habits in retirement. A lump sum might be suitable if you plan for significant upfront expenses. An RIS is ideal for those seeking a stable income stream.
  • Life expectancy: If you anticipate a longer life expectancy, an RIS ensures you won’t run out of money.
  • Debt obligations: A lump sum can be used to pay off outstanding debts before entering retirement debt-free.

Additional Considerations

  • Tax implications: Lump sums may be subject to a 15% tax on contributions made after July 1, 2007. Conversely, ABPs are taxed at a 15% concessional rate, while LIS may be tax-free depending on your age.
  • Health status: An RIS can provide peace of mind if you have health concerns that might impact your future earning capacity.
  • Financial literacy: Managing a lump sum effectively requires financial knowledge and investment expertise. An RIS offers a simpler, hands-off approach.

Seeking Professional Guidance

Navigating superannuation options can be complex. Consulting a financial advisor can be invaluable. They can assess your individual circumstances, risk tolerance, and retirement goals to recommend the most suitable access method for your super.

Beyond Lump Sums and RIS:

There can be other options depending on your circumstances:

  • Part lump sum, part income stream: This allows you to access a portion of your super as a lump sum while retaining the security of an ongoing income stream.
  • Transition to retirement (TTR) pensions: These pensions allow you to receive income from your super while still working part-time.


Understanding your superannuation access options empowers you to make informed decisions for a secure and comfortable retirement. Carefully consider the factors discussed above and seek professional guidance if needed. Remember, the best approach depends on your unique circumstances and long-term financial goals. By planning effectively, you can ensure your superannuation serves you well throughout your golden years.


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