Lower minimum pension drawdown rates
On 22nd March 2020, the government announced a 50% reduction in the minimum income drawdown from account-based pensions and similar retirement products for the remainder of the 2019-20 and 2020-21 financial years.
This means Australian retirees can reduce income payments from their superannuation-based pensions or income streams to minimise the need to sell down assets in depressed markets.
The temporary minimum drawdown rates are:
|
Age |
Standard minimum drawdown rates |
Temporary minimum reduced by 50% |
|
Under 65 |
4% |
2% |
|
65-74 |
5% |
2.5% |
|
75-79 |
6% |
3% |
|
80-84 |
7% |
3.5% |
|
85-89 |
9% |
4.5% |
|
90-94 |
11% |
5.5% |
|
95 and older |
14% |
7% |
If you are currently receiving the minimum, you will automatically be allocated the temporary minimum in the new financial year (starting 1 July 2020), but you can opt to change this and set your own amount as long as the elected amount is above the temporary minimum requirement.
If you'd like to find out more about pensions & Government measures in response to the Coronavirus pandemic, our readers have found this article an interesting read Government announcements regarding superannuation and pensions
For more information on WLM Financial's single-team approach to help you across your entire financial life: business and personal, accounting and financial planning click here. Or please contact us if you would like to meet with a financial planner to discuss your financial plans and create an investment plan to achieve your financial goals.
To read up on the latest financial insights and news including updates on the latest Federal Government Coronavirus measures and how these may affect your finances we recommend subscribing to our news.
If you have any questions or would like support, you can contact us at WLM Financial.
You can find out more about WLM Financials services and expertise regarding your Financial Planning here.
