Our advisers can help you structure your investments to ensure your retirement income stream will meet your needs now and in the future. We can help guide you through the myriad of complicated terms and unravel the mysteries of Centrelink.
This is a very important and nerve-wracking time in people's lives. Often our clients are unsure if they can afford to retire, or another planner has told them that the age pension is out of their reach. At North West Financial Services, we offer a full service planning process that will allow you to understand your options and maximise Centrelink payments.
To do this we use two types of income stream; both are tax-effective and both offer regular payments to supplement your age pension. They are:
Allocated pensions are an investment in a superannuation fund that provides regular income payments.
The allocated pension may invest in a mix of Cash, Capital Stable, Managed and Specialist funds. The value of your fund will rise and fall in line with the value of underlying assets - as determined by market conditions.
Allocated pensions are very flexible in that you can:
- Vary the level of pension payments, between the minimum and maximum levels prescribed by the Government
- Withdraw lump-sums
- Have the allocated pension account balance paid to your dependants on death or, alternatively, elect to have pension payments continue to your spouse.
Allocated pensions usually do not guarantee how long your pension payments will last. Essentially, there are two important factors which determine how long your pension income will last:
- Your investment earnings, which are determined by your investment strategy; and market fluctuation
- Your draw-down level, which is the level of pension payments you decide to take *
Allocated pensions may provide investors with a “tax-free” income stream depending on the clients age. In addition, these payments currently receive favourable treatment from the Social Security / DVA Income Test. Effectively, an amount equal to your purchase price, divided by your life expectancy, is returned to you, without being included as income for purposes of the Income Test.
* These factors are crucial to the successful allocation of your payments, and have to be addressed in the development of this strategy. Call North West Financial Services on (07) 3300 1771 to arrange a consultation.
An annuity is a simple and secure investment that will provide a guaranteed income stream. They are drawn over your life expectancy, or 15 years - whichever is the lesser. It is a practical investment alternative where the regular income payments are the same as continuing to receive a wage or salary.
Annuities may also receive substantial tax advantages. They offer a range of options to choose from so that the investment is tailored to suit your needs. The options selected, and the amount invested, will determine the level of income you will receive. It should also be mentioned that the investment into a complying annuity can be made from superannuation proceeds or your own cash.
We pride ourselves on our knowledge in this complex area and will not only recommend a strategy that will allow you to maximise your Centrelink entitlements, but we will liaise with them on your behalf.
If you are about to retire, contact us to discuss your needs and we will write a pre-retirement plan that will give you indicative incomes from your current assets.
If you are retired and want to ensure that your finances are structured correctly, then please feel free to contact us for an audit of your current portfolio.
Contact us today to discuss all your retirement needs.