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Making your super last

When Australians reach retirement age, they have the option of withdrawing their superannuation as a lump sum or taking a pension that will be a reliable source of income for a number of years.

Taking out your superannuation as a lump sum can be incredibly tempting, especially if you reach retirement age with some debts that still need to be paid off. However, blowing through your superannuation is easier than you think. If you choose to withdraw a lump sum, then you find your superannuation is insufficient to fund a comfortable retirement.

Industry experts estimate that a single person needs an income of approximately $43 000 per annum to fund a comfortable retirement while a couple needs approximately $58 000. The age pension, at its current rate, only just exceeds half of these amounts.

If you are nearing retirement age, you should carefully consider your options when it comes to withdrawing your superannuation. If there is some reason that you need to make a lump sum withdrawal, for example, a daunting mortgage, then you may care to investigate a variety of strategies. Remaining in the workforce for an additional few years will boost your superannuation savings and the transition to retirement program offers over 55s some significant tax breaks.

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What to consider when consolidating your super

August 27, 2020

The ATO reported that 45% of working Australians were not aware that they had multiple super accounts in 2016. Having multiple super accounts is particularly common for individuals who have had more than one job. If this is you, it is important to identify and manage your super accounts because having more than one can be costly as a result of account fees from multiple funds.To combat this, you may want to consolidate your super, which moves all your super into one account. Not only does this save on fees, but it also makes your super easier to manage and keep track of.

Before consolidating your super, it is important to do the following:

Research your funds’ policy
Compare your active super accounts so you can make the right choice about which one you should close. Things to assess include:

Check employer contributions
Changing funds may affect how much your employer contributes, as some employers contribute more to certain funds. Check your current accounts to see if changing funds will affect this. Once you have selected a super fund, regardless of whether you choose a new super fund or one of your existing ones, provide your employer with the details they need to pay super into your selected account.

Gather the relevant information
When consolidating your super, you will need to have the following details ready: