Barbara is a mum of four grown up children and a grandmother to seven.
As well as raising her children she juggled part-time work as an administration assistant, picking up more hours as her kids grew older.
She separated from her partner years ago and now lives by herself in a rented unit near the beach.
Now 70, she’s been enjoying retirement for the past five years. Due to being in and out of the workforce, her super balance at 65 was $50,000 and she knew she would need to rely on the Government Age Pension to fund her retirement.
Before retiring, she spoke with her Industry SuperFund about how to make the most of her $50,000. They advised her to draw down on her super through an income stream to top up her Age Pension. That would maximise the amount of Age Pension she would receive and allow her $50,000 to continue to grow a little in the early years of retirement, before she gradually draws down on all of it.
Here’s what that looked like:
- Her super balance was $50,000 when she retired, which she converted into an income stream account with her Industry SuperFund.
- Over the past five years she withdrew on average around $2,655 each year to top up her Age Pension.
- Today, her Industry SuperFund balance has grown to $53,747.
- Barbara experienced an average five-year Industry SuperFund investment return of 6.78% (2017 - 2022).
- Her annual income over the past five years (from her super and the Age Pension) has been about $30,234.
For Barbara, that extra $2,655 comes in handy for the grandkids at Christmas time and to fund a holiday every year.
Barbara's numbers
| Closing Balance | $53,747 | |||
| Account balance invested after income taken |
Income stream payments | Age Pension payments | Total income | |
|---|---|---|---|---|
| 2017/18 | $50,000 | $2,500 | $26,533 | $29,033 |
| 2018/19 | $52,603 | $2,630 | $27,102 | $29,733 |
| 2019/20 | $53,888 | $2,694 | $27,648 | $30,343 |
| 2020/21 | $50,777 | $2,539 | $28,181 | $30,720 |
| 2021/22 | $548,196 | $2,910 | $28,431 | $31,341 |
Barbara is not an actual member. Her story has been created for illustrative purposes.
Modelled outcomes by SuperRatings show 5-year average net benefit results taking into account historical earnings, fees and drawdown amount of 5% p.a. of the main balanced investment options of 11 Industry SuperFunds’ retirement income products during the first 5 years of retirement. Example assumes the average 5 year Industry SuperFund investment return of 6.78% p.a., starting balance of $50,000, starting age of 65, home is rented, access to the full Age Pension including rent assistance, single, no other assets or income sources available. Modelling as at 30 June 2022. Performance (Net Benefit) modelling is based on actual reported returns over the stated period. Capital growth will not continue throughout retirement. Past performance is not a reliable indicator of future performance. Returns may fluctuate over time and can vary significantly from year to year. Outcomes vary between individual funds. Consider a fund’s Product Disclosure Statement (PDS) and your personal financial situation, needs or objectives, which are not accounted for in this information, before making an investment decision. For more details about the SuperRatings modelling see the Assumptions page.
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