In March 2020, responding to the emerging COVID-19 pandemic, the Federal Government temporarily halved minimum pension drawdown amounts. This allowed pension members to withdraw less of their retirement savings and keep a greater amount invested.
The reduced minimum was extended into FY 21, 22 and 23. However, the government has recently announced that the minimums will return to normal from 1 July 2023.
If you currently draw less than the normal minimum amount, your payment will automatically increase to the new minimum from 1 July. If you currently draw more than the new minimum, your payment will remain the same.
This change may mean that your minimum annual drawdown will increase sharply in just a few weeks. For some, it may even double. If you’re impacted, it’s essential to start thinking now about how you will put any surplus to good use.
You may have a few options to make the most of these additional funds, from contributing back to superannuation, investing in other assets or achieving a retirement goal sooner.
However, the requirements can be complex to navigate, and it’s important that you are making the right moves for your specific life circumstances.
If you will be affected, it’s important to speak to your Apt adviser as soon as possible to make the best possible moves from the outset. If you aren’t an Apt client, reach out for a free, confidential chat with our team to find out how we can help you live your best life in retirement.
General Advice warning
The information provided in this blog does not constitute financial product advice. The information is of a general nature only and does not take into account your individual objectives, financial situation or needs. It should not be used, relied upon, or treated as a substitute for specific professional advice. Apt Wealth Partners (AFSL and ACL 436121 ABN 49 159 583 847) and Apt Wealth Home Loans (powered by Smartline ACL 385325) recommends that you obtain professional advice before making any decision in relation to your particular requirements or circumstances.
