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Account-based pensions

Turn your super into a regular income stream

Page reading time: 2 minutes

An account-based pension offers regular, flexible and tax-effective income from your superannuation.

You can get one when you reach 'preservation age' (between 55 and 60). It lasts as long as your super money does, but is not a guaranteed income for life.

How an account-based pension works

An account-based pension (or allocated pension) is a regular income stream bought with money from your super when you retire.

Typically, you get to choose:

Preservation age

You can get your super when you retire and reach your preservation age. This is between 55 and 60, depending on when you were born.

Minimum amount of money to withdraw

You need to withdraw a minimum amount each year, which depends on your age.

Age

Annual payment as % of account balance

55—64

4%

65—74

5%

75—79

6%

80—84

7%

85—89

9%

90—94

11%

95+

14%

Frequency of payments

You can arrange for monthly, quarterly, half-yearly or annual payments. Payments continue until the account balance runs out or you take what's left as a lump sum.

How long your pension lasts

How long your account-based pension lasts depends on:

Getting the Age Pension

Your eligibility for the Age Pension depends on your age, assets and income. Your account-based pension forms part of the income and assets test to assess your eligibility.

Your account-based pension after you die

Money left in your super account when you die will go to your beneficiary or your estate.

Pros and cons of an account-based pension

Consider the pros and cons to decide if an account-based pension is right for you.

Pros

Cons