Retirement Planning - Allocated Pensions
Allocated Pensions

Our financial planners’ expertise in retirement planning will allow you to structure your portfolio correctly to maximise tax breaks such as allocated pensions and increase your income in retirement.

Allocated pensions – What are allocated pensions?

An allocated pension is an investment that lets you rollover your super money into an account held in your name in a super fund. This has many tax advantages since the growth you receive is tax free.

Allocated pensions can be considered to be a superannuation fund that has been moved into a retirement phase, allowing you to draw down an income or lump sum.

allocated pensions


Allocated Pensions – The Benefits

Allocated pensions are a flexible and tax-effective way to provide income in your retirement.

With an allocated pension you can:

  • Vary your pension payments (within government minimums and maximums)
  • Vary between monthly, quarterly, six-monthly or annual payments
  • Withdraw lump sums
  • Specify how much and to whom benefits are to be paid upon your death
  • Choose from a range of investment options.

Allocated pensions are also tax-effective:

  • Investment earnings added to your allocated pension account are tax-free
  • Pension payments are taxable, but may have a tax-free component
  • Lump sum withdrawals are subject to tax at lump sum tax rates
  • You may be entitled to a tax rebate
Allocated Pensions – The Pitfalls

Allocated pensions do have some disadvantages:

  • There are restrictions on the amount of pension you can take each year
  • There is no guarantee your pension payments will continue throughout your lifetime, taking maximum withdrawals or poor investment performance could reduce the value of your allocated pension fund
  • Your investment returns may not perform to your expectations, reducing your anticipated income.
  • You can’t split your pension between husband and wife to reduce tax
  • Allocated pensions are not exempt from the assets test for social security purposes

Whether you’re unsure of which retirement strategy is the most appropriate for you, just looking to enhance the investment returns from your current retirement portfolio or confirmation of whether your current retirement strategy is up to date with recent changes in legislation, our planners will be able to assist.  Feel free to give us a call and chat about your investments; we are real people able to give you a personalised service, not a call centre.