Transition to Retirement Strategy


In this video Gavin Martin, Financial Adviser and the Managing Director of Cornerstone Wealth explains the Transition to Retirement (TTR).

Ideally reduce your taxable income to no more than 15%

What is Transition to Retirement (TTR)?
• Introduced in the later years of the Howard / Costello era
• Provides access to superannuation money once preservation age is reached (previously you needed to fully retire or reach 65 years of age)
• Designed to allow people to scale back from full time work to part time work and use superannuation to supplement the reduced income.
• Greater financial advantage is achieved by continuing to work full timeand combining salary sacrifice into super to save significant amounts of tax (particularly once 60 years of age)

Tax benefits are 3 fold

1. Tax free income if 60 years of age or concessionally taxed income if 55 – 59 years of age
2. 0% tax rate in pension phase vs. 15% in accumulation phase
• $500,000 superannuation balance earning 5% income
• $25,000 income at 15% tax = $3,750 saving in pension phase.

If condition of release is not met:
• Non-commutability (no lump sum withdrawals)
• 10% drawdown

By rolling over all but the minimum from your Christian Super account to a TTR Christian Pension, you can benefit from this TTR strategy.

If you are over 60, the pension payments you receive will be tax free. You must withdraw a minimum of 4% from your TTR Christian Pension, but these funds can be re-contributed back into your Christian Super fund if you wish.

You also have the option of investing in multiple investment funds, such as, a 50/50 split in defensive and growth investments. This provides you with a variety of options to help cater your investing needs.

This presentation has been prepared without taking into account the personal objectives, financial situation or needs of any person. You should consider the appropriateness of the information presented having regard to your own objectives, financial situation and needs and obtain professional financial advice prior to making any decision.

Before making any decision about whether to acquire any financial product, you should obtain and consider the information contained in the relevant Product Disclosure Statement.

©Cornerstone Wealth 2014. All rights reserved. No part of this presentation may be reproduced in any form without the prior permission of the copyright.


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