{"id":2438,"date":"2023-11-02T06:21:08","date_gmt":"2023-11-02T06:21:08","guid":{"rendered":"https:\/\/blog.villages.com.au\/?p=2438"},"modified":"2023-11-02T22:04:27","modified_gmt":"2023-11-02T22:04:27","slug":"what-is-a-transition-to-retirement-plan-and-when-should-it-be-used","status":"publish","type":"post","link":"https:\/\/blog.villages.com.au\/retirement\/what-is-a-transition-to-retirement-plan-and-when-should-it-be-used\/","title":{"rendered":"What is a Transition to Retirement plan \u2013 and when should it be used?"},"content":{"rendered":"\n<p>Every worker with a superannuation account has access to three \u201ctransition to retirement\u201d (TTR) payments that allows you access to some of your super while you keep working.<\/p>\n\n\n\n<p>But setting up a TTR can be complicated.<\/p>\n\n\n\n<p>If you are interested, it\u2019s best to contact your super fund or financial adviser for advice.<\/p>\n\n\n\n<p><strong>When can I access a transition to retirement payment?<\/strong><\/p>\n\n\n\n<p>If you\u2019ve reached your preservation age and are still working, you can use a TTR strategy to:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>supplement your income if you reduce your work hours, or<\/li>\n\n\n\n<li>boost your super and save on tax while you keep working full time<\/li>\n<\/ul>\n\n\n\n<p><strong>Starting a TTR pension<\/strong><\/p>\n\n\n\n<p>You can start a TTR pension by transferring some of your super to an account-based pension.<\/p>\n\n\n\n<p>There is the need to keep some money in your super account to continue to receive your employer\u2019s compulsory contributions or any voluntary contributions you make.<\/p>\n\n\n\n<p><strong>Government benefits and TTR<\/strong><\/p>\n\n\n\n<p>However, setting up a TTR pension may impact your or your partner\u2019s Government benefits. It\u2019s important to speak to a Services Australia Financial Information Service (FIS) officer for more information.<\/p>\n\n\n\n<p><strong>Life insurance and TTR<\/strong><\/p>\n\n\n\n<p>Another point to consider is if you have life insurance with your super. Check if your cover reduces or stops if you start a TTR pension.<\/p>\n\n\n\n<p><strong>Using TTR to reduce work hours<\/strong><\/p>\n\n\n\n<p>If you want to reduce your work hours, a TTR strategy can also help to top up your income.<\/p>\n\n\n\n<p><strong>The pros<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Continue to receive super contributions \u2013 this helps to replace the money you take out.<\/li>\n\n\n\n<li>Pay less tax \u2013 if you are 60 or older, your TTR pension payments are tax free. If you are 55 to 59, your pension is taxed at your marginal tax rate, but you get a 15% tax offset.<\/li>\n\n\n\n<li>Ease into retirement \u2013 you can start planning what you\u2019ll do with your leisure time before you retire completely.<\/li>\n<\/ul>\n\n\n\n<p><strong>The cons<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Affects retirement income \u2014 If you start drawing down your super early, you\u2019ll have less money when you retire.<\/li>\n<\/ul>\n\n\n\n<p>In short, you can use a TTR pension to grow your super and pay less tax in the lead up to retirement.<\/p>\n\n\n\n<p>But this strategy tends to work best if you are 60 or older and a mid to upper income earner \u2013 seeking financial advice can help you decide if it is the right option for you. <\/p>\n\n\n\n<p><strong>The information provided is for general purposes only and not financial advice. Consult a professional before making financial decisions. Your decisions are at your own risk.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Every worker with a superannuation account has access to three \u201ctransition to retirement\u201d (TTR) payments that allows you access to some of your super while you keep working. But setting up a TTR can be complicated. If you are interested, it\u2019s best to contact your&#8230;<\/p>\n","protected":false},"author":1,"featured_media":2441,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","om_disable_all_campaigns":false,"_mi_skip_tracking":false,"footnotes":""},"categories":[70],"tags":[],"class_list":["post-2438","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-retirement"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/posts\/2438","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/comments?post=2438"}],"version-history":[{"count":1,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/posts\/2438\/revisions"}],"predecessor-version":[{"id":2439,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/posts\/2438\/revisions\/2439"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/media\/2441"}],"wp:attachment":[{"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/media?parent=2438"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/categories?post=2438"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.villages.com.au/blog\/wp-json\/wp\/v2\/tags?post=2438"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}