Early super access rules prompt more pension make overs
Fund managers are increasingly adding new non-commutable allocated pensions to their product range in response to the Federal Government’s new transition to retirement rules.
Last week MLC added the income stream, which largely resembles its allocated pension, to both its MasterKey platform and MasterKey Custom Superannuation, following a similar move several weeks ago by AMP.
Implemented on July 1, the new transition to retirement rules are designed to assist the transition of older Australians from full-time work to retirement by allowing them to access some of their superannuation benefits before they retire.
By taking a non-commutable income stream in the form of either a pension — like a TAP — or an annuity, people who have reached the preservation age of at least 55 can top up their salary when moving into part-time employment.
One of the most popular forms of a non-commutable income stream under the new rules will be non-commutable allocated pensions, according to Anthony Waldron, head of MLC Investment Solutions.
“These pensions enable people to vary the income they receive, within certain limits, while all of the usual withdrawal options are available when a full condition of release is met,” he said.
Full retirement is a condition of release.
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