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Superannuation Post-Retirement: What You Need to Know

Your superannuation has two distinct phases: the accumulation phase and the drawdown phase. 

  1. The accumulation phase refers to the duration of your working period, where you can contribute to your super fund or where your super balance is accumulating. 
  1. The drawdown phase is referring to your retirement phase where you are able to access your superannuation. 

There are many things you can do with your super fund. Aside from leaving the money in the account until you need it, other options include:

  • Drawing some or all of the money as a lump sum
  • Moving money into an annuity 
  • Transferring funds into an account-based pension.

It’s crucial to know that when it comes to your super fund, you are allowed as a retiree to choose more than one of these options. 

Is it Wise to Leave Your Money in Super During Retirement?

Many people opt to keep their money in their super. This way, your super balance will continue to grow. Plus, you can still make ad-hoc withdrawals when you like.

But this isn’t advisable in some situations when it may not be the best use of one’s money as your super investment earnings are not tax-free.  

The superannuation system in Australia exists to provide people with funds to spend once they retire, so leaving it in the accumulation phase isn’t always the most beneficial. 

Your financial adviser may provide you with alternative strategies for a retirement plan that suits your needs and lifestyle

When Can You Take Money Out of Your Super?

You can withdraw your super once you reach the age of 65 and once you meet your super fund’s conditions of release. You may also access your money once you’ve reached your “preservation age,” which ranges from 55–60, depending on your year of birth1. 

Moreover, you’ll have to meet specific conditions if you want to take all your funds out as a lump sum. You’ll have to meet one of these criteria:

  • Turning 65
  • Fully retired
  • Over 60 and finishing at a workplace (even if you get a new job)

If you have reached your preservation age but haven’t met the requirements mentioned above, you may want to consider using a ‘Transition to Retirement’ (TTR) strategy. The TTR strategy lets you access some of your super and continue to work for a certain period of time. 

You can use this strategy to:

  • supplement your income if you reduce your work hours, or
  • boost your super and save on tax while you keep working full time.

Moving Super Funds into Annuities

You may opt to move your super into an annuity (otherwise known as a fixed-term pension), where it can provide you with a regular income stream in retirement. 

This strategy can provide you with guaranteed income payments for a fixed term or for the rest of your life. 

Annuities are tax-free for those over 60, and retirees can control what happens to their fixed-term annuity if they die before the term’s end.

When using an annuity, you have the option of choosing whether you want your payments to last for: 

  • A fixed number of years, 
  • Your life expectancy, or
  • The rest of your life. 

This can provide you with peace of mind if you’re worried that you might outlive your retirement savings.

Annuities can offer more certainty about post-retirement income, especially because they are not affected by market fluctuations. However, the drawback is that you generally have less flexibility. Depending on the annuity, you may not be able to change the income amount or the term’s length. 

Transferring Funds into an Account-Based Pension

You may want to consider using an account-based pension for your super or, to receive a steady income stream from your super balance. 

As a retiree, you can choose with an account-based pension:

  • How much of your super you’d like to transfer to your pension account (subject to the balance transfer cap2)
  • how often you’d like to receive your payments,
  • how you want you super invested through your fund.  

Like annuities, account-based pensions are tax-free for individuals over 60.

Seek Professional Retirement Advice

When it comes to your retirement plan, your superannuation is a very important component and it is wise to make informed decisions to maximise your money.

\ It’s best to work with a professional to know which options suit you best.

If you’re looking for professional retirement advice in Melbourne, Australia, EJM Financial Services has you covered. 

Let our expert financial advisers provide you with personalised solutions to help you achieve your goals. 

Request a complimentary meeting today!


  1. https://www.ato.gov.au/individuals/super/in-detail/withdrawing-and-using-your-super/withdrawing-your-super-and-paying-tax/?page=2
  2. https://www.ato.gov.au/individuals/super/withdrawing-and-using-your-super/transfer-balance-cap/

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General Advice Warning: This article contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information.


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