As part of the 2021/2022 Budget announcements, the government has confirmed the halved minimum pension drawdown rates will be extended for the next financial year.

The below table outlines the temporary minimum pension % you may be eligible for (note the relevant age is based on your age as at 1 July 2021):

Table showing minimum pension by age bracket

You may have already made changes to your superannuation pension last financial year, however as circumstances change – grandkids to spoil/travel (to Queanbeyan) – you may want to review the level of pension, keeping in mind you can choose to draw more (in many cases, much more) than the minimum.

Please feel free to contact us if you have any questions.

The Halletts Team

Older man with Superman robe and cane holding

You may have seen headlines recently announcing the indexation of the superannuation general transfer balance cap from $1.6m to $1.7m (essentially the maximum you can have to fund a retirement income stream) from 1 July 2021.

Two pigeons discussing jargon

Some of our clients who are already indulging in the joys of a retirement income from their super fund may have done a happy dance in anticipation, but unfortunately you can put those tap shoes away ……. the rule only applies to those starting a retirement income stream for the first time on or after 1 July 2021. There are a few very specific exceptions but in general, No Soup For You sorry.

Soup Nazi saying "no soup for you!"

Looking on the bright side for those yet to start a retirement income stream, there will be a little bit more room in the cap for you to grow your balance should you choose (either individually, or with the benefit of specific financial advice which considers your personal circumstances, which our little blurb above is not!)

At this stage there is no change to the concessional or non-concessional limits, with some prospect that they will lift from 1 July 2022……

Dory saying "Just keep swimming"

You may have already changed your superannuation pension draw down amount for the 2019/20 financial year since the government halved the minimum amount you are required to draw down from your nest egg in April.

This is a friendly reminder that the lesser minimum amount is also available for the 2020/21 financial year – so you may also need to direct your fund to change the amount for the new financial year …. if that’s what you would like to do.

Also worth noting is that your 2020/21 minimum pension will be calculated based on your battered and bruised pension balance as at 30 June 2020, so this may further reduce the amount you must draw and allow you to keep more aside for future bequests to the kids, their lawyers (and accountants) and the Lost Dogs’ Home.

Confused? Please don’t hesitate to call us!

The Halletts Team

Bird's nest with two blue eggs