David Koch: Now, why is turning 60 such a major milestone when it comes to super?
Bec Harvey: Yes, 60 is an exciting time, but why is 60 really important? Well, the rules change at that point in time, so accessibility becomes easier.
David Koch: Welcome to In the Hammock, the podcast and video series designed to support you and your super with Brighter Super experts helping you build confidence on your path to a brighter retirement. We're here to make super and retirement feel a whole lot simpler. I'm David Koch, and today we're talking about one of the biggest milestones in superannuation, turning 60. For many Australians, this is the point where super stops feeling like some distant future account and starts becoming real money you may actually access. But with that flexibility comes a lot of questions. Can you access your super? Should you keep working? Take a pension, withdraw a lump sum? So many questions. Joining me is Bec Harvey from Brighter Super. Why is turning 60 such a major change in your super?
Bec Harvey: So 60 means you've met your preservation age. So that's a term for just saying that your super can now become accessible. However, you then have to meet what is called a condition of release. So that means that you've either fully retired or potentially you've left a job, but you're not planning to permanently retire. But before I get too much into it, I should remind people that I'm going to provide general advice today, so it doesn't take into account someone's personal circumstances, needs or objectives. So before you take any action today, you really need to make sure if this suits your circumstances.
David Koch: So this is where people realise super isn't locked away forever anymore.
Bec Harvey: No, that's right. Up until you were 60, it was kind of locked away, I suppose.
David Koch: And a lot of people may be surprised that turning 60 doesn't mean you need to fully retire. There are a lot of options, aren't there, available to you? So let's go through and simplify what turning 60 means in superannuation.
Bec Harvey: Yeah, so at 60, like I mentioned, you've met your preservation age. You then have to meet what's called your condition of release, which basically means you've either permanently finished work or you've left a job. So that's a really exciting way to start accessing your super. So at 65, this is another condition of release. You could have kept working from 60 to 65. You haven't left your job, you haven't permanently retired, but at 65, all bets are off and you can now actually access your super even if you are working. And then 67 is when the Age Pension comes in.
David Koch: And for a lot of people, it is just the change in mentality and thinking about your super. Now you suddenly realise, oh, maybe I can start accessing. And that's a big shift in people's thinking process.
Bec Harvey: It is a big shift, but they also need to be mindful of starting to access their super. You've got to think about the longevity of your super over time as well. So if you start accessing it and accessing lump sums, it's still got to last a long time. So we're all living well into our 80s, if not 90s, and we want our super to have longevity and to last that time. It might be supplemented a little bit by age pension as well, but it's really important to think about those things as well.
David Koch: As an extension of that, is that a big option could be do nothing.
Bec Harvey: Exactly.
David Koch: When you turn 60.
Bec Harvey: Yeah, exactly. It's an important age. However, you may not be ready to retire. So you've still got your super guarantee payments going in from your employer. You're still making your salary sacrifice. You're still investing your money, making sure you've made an active choice about how your money's invested because your money's still compounding. It's been compounding since you started work and it still continues to compound and grow for you as well.
David Koch: So don't be pressured by turning 60, because your super is still growing, your retirement sort of little pot of gold is still growing as well. You can take your time, take a breath. You don't need to see it as a deadline, do you?
Bec Harvey: Not at all. How great to have options. That's really what it is. There's so many options at 60, which is why it's important to start getting educated about what are now your options.
David Koch: Yeah. And when you turn 60 as well, you start thinking, okay, what about this transition to retirement? You hear a lot about, do I cold turkey on retirement or do I ease into it? Just explain to us transition to retirement, what it means.
Bec Harvey: Transition to retirement can mean a couple of things. So you might be working for an organisation, and they call it transition to retirement. And then there's also a product within super called transition to retirement as well. They both work somewhat similar. Your employers saying, "I want to start transitioning you or you want to start transitioning out of the workforce, but we still want to keep you here because you've got some really good skills and experience we want to pass on to others." And then you might go, "That actually really works for me. I want to start cutting down from five to maybe to four or three days." And that's where the super product called transition to retirement comes in. So you can start potentially accessing your money from your super to supplement your income because you've reduced your hours at work. And the great thing about that is it's tax-free and it's not assessable in your tax return either.
David Koch: So that money's now tax-free. The important thing to know also about a Transition to Retirement (TTR), it's got some rules around it, of course, like everything does. You have to take at least a minimum of 4% in a year, but you can take up to a maximum of 10% of your super that you move into the Transition to Retirement (TTR).
Bec Harvey: So I'll give you another example. Apart from reducing working hours and using that as a means to access your super, another way of accessing your super is - members that I've spoken to have helped their kids go through uni, so they get a regular payment coming out to help supplement that, deposits on houses for kids as well. So, they moved half a million dollars or 500,000 into a Transition to Retirement (TTR) so they could get that maximum amount of 10%. So that was the 50,000. The great news is at the end of that financial year, they could actually finish up that Transition to Retirement (TTR). They didn't have to keep it, but they could if they wanted to as well. So there's options around Transition to Retirement (TTR).
David Koch: It just gives you great flexibility, doesn't it? Because moving into retirement is a bit scary for people. So being with your partner twenty-four-seven, seven days a week is one of the scary things. So easing yourself into it but using your super to provide that income buffer is really comforting to protecting people's lifestyle as well.
Bec Harvey: Absolutely. Practise, practise, practise. And if you don't like it, you can always go back into the workforce full-time as well. But the other thing to remember as well is accessing your super early can impact your super in the long-term because you're starting to access it early. So it's important to get some advice around Transition to Retirement (TTR) because whilst you're accessing it, you’ve got to think about what's my longevity now of my super in the long run? How do I invest it? Is this the right option for me? And those sorts of things.
David Koch: Yeah, all right. Let's talk about income streams, turning your super into an income stream because our whole working life is built around getting regular income from our employer and often we have built our financial life around it. How can you turn super into, if you like, your retirement wage that keeps coming through?
Bec Harvey: And that's the whole reason, one of the reasons super exists is we've built it up over our working life so we can now start accessing it and turn the tap on because the tap turns off from your employer, you're no longer getting that fortnightly wage and you're like, "Where's my money going to come from?" Well, that's where super comes in.
So an income stream is a really powerful tool. A lot of members think when they retire, they actually have to take their money out of super. I've had members walk in and we've had conversation and that's not necessarily the right approach. Keeping your money in super is a really tax effective way to still grow your money and access your money. Let me talk a little bit more about it. So at the moment, a member might be in an accumulation fund. You can take lump sums out when you've retired, which is great, and it's tax-free because you're over the age of 60, but your investment returns are taxed up to 15%.
A member can choose to move all or part of their money from an accumulation style account into what's called an income stream or a pension product. So with that, they can still draw lump sums or they can opt to take a fortnightly, monthly, quarterly, half-yearly or yearly payment amount from their pension account. You invest your money during this time. So it's still invested in shares or property, infrastructure, cash, bonds, those sorts of things. You're still earning an investment return when you move into an income stream. The great news is this is now tax-free. Then you can start taking money out of super. You can either take out a lump sum, no tax on that, but you also have to take a minimum amount.
When you're in an income stream, the ATO says you have to take a minimum. If you are the ages between 60 and 64, it's 4% of whatever the amount is that you put into that pension product. It continues to go up. So from 65 to 74, it goes to 5%, and from 75 to 79, it goes to 6%. And it continues to rise up to 14% that you need to take out of your super every year based on the balance as at the 1st of July.
David Koch: And also, as you say, it stays invested as the income stream comes out because a lot of people would be thinking, well, why isn't it easier just to take the super out as a lump sum, bang it into a term deposit or some other bank account and just live off the interest? What's the difference?
Bec Harvey: So the difference is once it's outside of the superannuation system, which is in pension phase, 0% tax environment, there may be tax implications when it's sitting in the bank because it's now earning a return. It may end up being taxable income.
David Koch: Right. So a pension can be, got to get the right advice, can be more tax effective in terms of earning an income.
Bec Harvey: It may be. So that's one of the reasons you get financial advice to make sure you make the right decisions. Should the money be in super? Should it be outside of super? And make sure that you make the right decisions on setting up yourself for the best retirement you can.
David Koch: Yep. As you were saying though, the other option is to withdraw the money as a lump sum. What should people think about if they're looking at that as an option?
Bec Harvey: It depends on why they'd be withdrawing as a lump sum. Some people take out money as a lump sum because they want to pay off part of their mortgage or buy a car or for renovations, holiday, etc. So taking money out as a lump sum is an option because it may fund certain budgetary requirements for them. But if you're taking it all out, I'd recommend getting some financial advice to understand why you'd be doing that and making sure that you're taking advantage of the superannuation system.
David Koch: And as you explained before, it's all about does it affect your future retirement income? You've got to look at tax and Centrelink rules. There are a whole lot of areas you've got to tick off.
Bec Harvey: Exactly right. So one of the great things about seeing a financial advisor is they'll take into account Centrelink provisioning for you and your partner. So that's really important that you go in if you have a partner and think about your situation as a whole. So they'll look at that. They'll look at longevity, look at how to invest your money, your budget to make sure you're on track for your money to last the way you want it to. And also estate planning needs to make sure that when unfortunately we may depart this earth, the money's left in a way that you'd like it to be.
David Koch: So turning 60 is exciting because your super can be accessed, but it also is a time to think it through and you've got a lot of decisions to make and a lot of flexibility. So there's a lot to be excited about, a lot of decisions to make. For people watching or listening to this podcast, what are the biggest takeaways that you want them to make a note of and action right now?
Bec Harvey: The biggest takeaway would be start educating yourself. So great first step if you're listening to this, I think, make sure you're getting your budget in place. Understanding how much money do you actually spend now so you understand how much money you're going to spend in retirement as well. You could go onto the Association of Superannuation Funds of Australia website, that's ASFA, where they regularly survey retirees who are 65 plus, own their own home and work out how much is it actually costing them to live. And there's even one on there for people that don't own their own home as well. So it can help you really understand what your budget is. And then they need to start to think about how am I going to invest my money into the future as well? Because you still need your money to be working hard, so you've got the longevity of your funds in retirement because we're living longer and longer, so we still need to think about how are we going to invest it, maybe not being so conservative.
A lot of the times members come in and they say to me, "I'm nearly 60. I should go into something conservative. I should go into cash or something like that." And we need to be mindful of the fact that if we retire at 60, we could still be living into our 80s. That's 20, 25 years that our money still needs to be working hard for us. So what's the right strategy? Maybe cash isn't the strategy, maybe that's part of it, but there are so many other investment options to make sure that your money's still working hard. So members need to be thinking about those things.
David Koch: And what are the biggest mistakes you see from members?
Bec Harvey: Biggest mistake is probably not having a chat with someone and trying to make some really big decisions on your own. I always say you've got one chance to retire right. This is a really important part of your life when you turn 60 and you're starting to think about retirement. So getting some good advice is just paramount.
David Koch: And I suppose the other thing as well is people can sort of get a bit scared about the decision making and do nothing. Now, yes, do nothing is an option, but you're going to have to face it at making those decisions at some time, don't you? So don't be paranoid and paralysed into doing nothing because there are plenty of resources that you can call on.
Bec Harvey: Absolutely. I've spoken to members and they go, "I wish I had done this five years ago and had this discussion because I didn't know about this product or this service or how this worked." And they've not necessarily wasted five years, but they could have been doing something so much better over that five-year period to make sure they had a better financial outcome in their retirement.
David Koch: Yeah. And it's reassuring because turning 60 isn't the end of your financial decision making for your superannuation and retirement. It's just a new set of options become available, don't they, that you've got to be aware of. And that's the exciting part about retiring.
Bec Harvey: I think so. I think it's a really exciting part. And here at Brighter Super, we've got financial advisors that can help our members take them on that journey. You can listen to webinars, seminars. You can get a super health check, also at no additional costs, that's through our general advice service. And then you can even start talking to our financial advisors. You can get something called super advice, which is advice around your investments, your contributions, or maybe your insurance, but you can also get something called a retirement health check at no additional cost. They can help you with, “am I on track” or are you not on track for your retirement? But some members go, "Can I retire? I actually don't know." That service can really assist.
David Koch: So don't be afraid of this time of life. It's really exciting. Make the right decisions but plug into the experts like Bec. Bec, good to see you.
Bec Harvey: Thanks, Kochie. Good to see you.
David Koch: Thanks for watching In the Hammock. If you found this useful, give it a like, share it with someone approaching retirement. We'd love you to do that and make sure to follow or subscribe to watch or listen to future episodes and keep building your confidence on your path to your brighter retirement. We'll catch you next time.
Disclaimer
To learn about the rules for accessing your superannuation, visit the ATO website: https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/withdrawing-and-using-your-super/super-withdrawal-options?.
Figures quoted are current for 2026/27 financial year. Minimum and maximum pension limits apply. General information only - other conditions and eligibility requirements may apply. Drawdown amounts each year are based on balance at 1 July.
From 1 July 2026, Division 296 tax may apply an additional 15% to earnings attributable to a total super balance above $3 million (and a further 10% above $10 million). It applies across both accumulation and pension accounts. Learn more at ato.gov.au – Division 296 tax.
Learn more about account-based pension minimum payments at https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/self-managed-super-funds-smsf/paying-smsf-benefits/income-stream-pension-rules-and-payments#ato-Minimumpensionstandards
A fee from $500 applies for each additional Brighter Super advice service such as advice on consolidating super accounts or including a non-Brighter Super member.
Examples provided are for illustrative purposes only.
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You should also obtain and consider the Product Disclosure Statement (PDS) before making any decision to acquire any product or contribute additional amounts to your Brighter Super account. A Target Market Determination (TMD) is a document that outlines the target market a product has been designed for. Find the PDSs and TMDs at https://brightersuper.com.au/pds.
