I’m 60 and retired. Should I start spending my super yet?
I am 60 years old and retired. My house belongs entirely to me and I have no debts. I have $770,000 at retirement in my savings account, which is still invested in a balanced option that yields about 7 percent. I also have $90,000 in earnings at around 4 percent, which I use to cover my living expenses of about $45,000 a year. I have no other income and expect to qualify for a pension at age 67.
My retirement fund offers a bonus of 0.65 percent on the 12-month average daily balance if the savings account is converted to a retirement phase account. Once converted I can withdraw lump sums as required. Is it better to move into retirement now to maximize my retirement balance and conversion bonus, or to continue living on my cash for another year?
Now I see no downside to switching your retirement to tax-free retirement mode. When you switch, all your earnings become tax-free, and your after-tax income increases immediately instead of leaving the money in savings.
Once you turn 60, you have up to 15 years to add to your retirement benefit, as long as your balance is under $2 million, so you don’t lose flexibility. A sensible structure is to move most of your money into retirement mode and leave a small portion in savings, directing future excess funds there. This maximizes your tax-free earnings while keeping your options open.
We are a married couple. I am 69 years old and receive Disability Support Pension, and my wife, who turns 67 in March 2026, is my carer. Once he reaches retirement retirement age, our total assessable assets will be three vehicles totaling approximately $30,000, approximately $1.1 million in cash, approximately $10,000 in household goods, and $10,000 in stocks. When my partner turns 67, how much, if any, Centrelink payment will we be entitled to and will we continue to have access to a concession card such as the Pensioner Concession Card or Commonwealth Seniors Health Card?
You definitely qualify for the Commonwealth Seniors Health Card as it is means tested and not means tested. When it comes to age pensions, the cut-off point for the means test for a home-owning couple is $1,074,000. With assessable assets of approximately $1,150,000, you are $76,000 over that limit.
If qualifying for retirement is important, it may be useful to seek advice on lifetime income streams. Under current rules, 40 percent of the purchase price is excluded from the asset test. For example, buying a $300,000 lifetime income stream would reduce your assessable assets by $120,000, putting you at around $44,000 below the cut-off point and qualifying for the age pension.
Disability Support Pension and age pension are means tested in the same way. You can expect to receive combined payments of approximately $3,400 in the first year; This amount will increase over time as your assets decrease. Additionally, the product will provide lifetime income.
Using the MyNorth Lifetime Income product as an example, investing $300,000 will provide a starting income of more than $21,000 per year (7.14%); Payments will be adjusted over time based on the performance of the chosen investment portfolio.
Income is paid for life and continues as long as either of you is alive. When combined with the Disability Support Pension of approximately $3,400 per year and the age pension, your total income in the first year could exceed $24,400.
What happens if shares are bequeathed to a non-resident Australian citizen for tax purposes (for example, someone living and working overseas in a country with no capital gains tax) and the shares are later sold?
Bantacs’ Julia Hartman says where the deceased is an Australian tax resident and shares are widely held, Australia loses the right to tax them if the shares pass to a non-resident beneficiary. As a result, the CGT rollover is not valid.
Instead, the decedent is deemed to have sold the shares at market value on the date of death, and any capital gains are included in the decedent’s final tax return. From this point on, tax treatment depends entirely on the beneficiary’s country of residence.
If the beneficiary subsequently returns to Australia as a tax resident and owns the shares, he or she is deemed to have purchased the shares at their market value at the date of their continued Australian tax residence.
When payday pensions begin on July 1, 2026, employers will be required to pay pensions within seven days of each payday, rather than quarterly payments. As a result, employees earning within the maximum contribution base will receive financial year 2026 quarterly super contributions in July 2026, even if these contributions relate to the last quarter of the previous financial year.
This creates an undesirable tax consequence: delayed FY26 fiscal contributions will fall into FY27, pushing affected employees over the concessional contribution cap and exposing them to tax at their marginal rate despite no increase in income or contributions. Will the ATO increase the concessional contribution cap in FY27 to ensure individuals are not overtaxed simply because of this transition timing issue?
A spokesman for Deputy Treasurer and Financial Services Minister Daniel Mulino says: “The government will ensure that people in these circumstances are not adversely affected as part of transitional arrangements to support the introduction of wage advance insurance.”
“We have passed primary legislation to bring salary depreciation into force in 2025 ahead of the 1 July 2026 start date and are advancing implementing arrangements with the ATO, including remaining legislation and regulatory amendments.”
Noel Whittaker is the author of: Retirement Made Easy and other books on personal finance. Questions: noel@noelwhittaker.com.au
- The advice given in this article is general in nature and is not intended to influence readers’ decisions about investments or financial products. They should always seek their own professional advice, taking into account their personal circumstances, before making any financial decisions.
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Noel Whittaker, AM is the author of Make Money Made Simple and numerous other books on personal finance.Connect with: X or email.
