How can you obtain an income in retirement?

Retirement incomes in Australia come in a number of types including the Age Pension. For most retirees they will have assets in superannuation funds before retirement which can then be transferred at retirement to either an Allocated Pension or into Annuities.

Annuities have a fixed interest rate of return and can go for a fixed term or continue on for life. They may be set up to revert to the spouse on death.

Allocated Pensions have more flexibility because

  • You have access to your invested funds if required,
  • You can change your income amount at any time,
  • There is no tax to pay after the age of 60,
  • The income is only partly assessed on the Age Pension Incomes Test,
  • On death the remaining assets can be passed onto your spouse and/or children.

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