Who might benefit from a TTR pension?

As the name suggests, a transition to retirement (TTR) pension could suit you if you’re getting close to retirement age but aren’t quite ready to stop working. It enables you to access some of the money in your super even though you’re earning a salary.

How can a TTR pension help me if I want to reduce my working hours?

If you’ve reached your preservation age (see below for an explainer) but are yet to fully retire, you can transfer some or all of your existing super savings into a separate TTR pension account. Then, you can use your pension payments to top up your income when you start working fewer hours and earn less.

How can I use a TTR pension if I want to boost my super?

If you’re getting closer to retirement and want to boost your super balance, you can use a TTR pension to put more into your super while you pay less tax. How does it work? You continue to work your usual amount, but salary sacrifice more of your before-tax pay into your super account. These contributions are taxed at 15%. You’ll also continue to get super contributions from your employer.

What is my preservation age?

To be able to start a TTR pension, you need to have reached preservation age. Your preservation age will be between 55 and 60 depending on your date of birth. You can work out your preservation age using this table:

How do I get started?

A TTR pension can make it easier for you to move from your working life into retirement, or boost your retirement income for when you finally finish work. But there are some complicated rules and a few limits, so it may not be right for you. That’s why it’s really important to consider talking to your financial adviser if you have one, or use our find an adviser service to locate one near you. A financial adviser can help you decide if a TTR pension suits your life stage and your financial goals. They can also discuss other retirement income options with you.

Transition to retirement (TTR) pension

Is a TTR pension right for you?

If you live in Australia and are thinking about a smarter path to retirement, here's how it could work for you.

You're over 60 and want to access your super

You can access up to 10% of your super each year while continuing to earn an income.

You want to ease into retirement gradually

A TTR pension helps you work less, keep your income steady, and transition smoothly.

You want to boost your super before retiring

Grow your super tax-effectively by salary sacrificing into super with a TTR pension.

If you’ve fully retired or you’re over 65, an account-based pension may suit you better. Our Guidance team can help you explore your next step.

What are the key benefits of a TTR pension?

If you’re nearing retirement but not ready to stop working, a TTR pension gives you flexibility, control and confidence.

Live your life, your way.

With a TTR pension, you can reduce your hours and still draw income from your super. Helping you ease into retirement without changing your lifestyle.

Cut your tax, boost your super.

Salary sacrifice into super while drawing from your TTR pension, a smart way to grow your savings and reduce your tax.

Greater flexibility. More freedom.

Access your super while you’re still working, giving you the freedom to top up your income and keep living the life you’ve built.

We’re standing by to help. Book a call now.

Colin's easing into retirement with confidence, clarity and freedom

At 60, Colin earns $100,000 and has $400,000 in super. He’s decided to reduce his work week to three days for the next five years, before retiring at 65.

He’s looking forward to more time with family, coastal getaways, and getting back to fishing - a hobby he’s missed. To support this lifestyle, Colin starts a transition to retirement (TTR) pension using $350,000 from his super.

By working fewer days, Colin reduces his salary by $40,000 a year. But thanks to a TTR pension, he only needs to draw $27,100 annually to make up his lost take-home pay, as the pension payments are completely tax-free. Colin knows he’ll retire with less but for him, the trade-off is worth it. More time now means more memories later.

If you’re aged 60 or over, all payments received from your TTR pension are tax-free.

What happens when you start your TTR pension?

Move money into a TTR pension

Start by transferring part of your super into a TTR pension. The amount you can receive each year will be calculated based on this balance.

Keep growing your super

Your super and TTR pension go hand in hand. Even while you draw from your TTR pension, your employer contributions will continue to build your super balance.

Receive regular payments

You can draw between 4% and 10% of your TTR pension balance each year. Once you turn 65, your account will automatically switch to an account-based pension.

Could a TTR pension support the lifestyle you want?

At no extra cost for CFS members, our guidance consultants can help you with transition to retirement by: 

Setting up your TTR pension and income stream
Answering planning questions or offering super-boosting strategies
Recommending more tailored financial advice, if you need it

Book an appointment today

Frequently asked questions

A TTR pension works by enabling you to access part of your super before you’ve completely retired.  

Once you’ve turned 60, you can typically start a TTR pension.

A TTR pension allows a maximum yearly payment of 10% of your account balance. So, if you start a TTR pension with a balance of $100,000, the maximum you’ll be able to receive in pension payments during that financial year is $10,000. 

In the first year of starting a TTR pension, the maximum limit is based on the balance you use to open your account.

If you’re aged 60 or over, all payments received from your TTR pension are tax-free.

However, investment earnings on the money in your TTR pension are still taxed at a maximum rate of 15% - the regular rate of your super investment earnings – until you fully retire or turn 65. After this time, your TTR pension will convert to the rules of account-based pension, future investment earnings are tax-free, and the balance of your TTR pension at that time will count towards your transfer balance cap.

When you're ready to move into full retirement mode, get in touch with us. We'll help you either:

Combine all your super into one retirement income stream
Change your TTR pension to an account-based pension

Note that your account will automatically switch over to an account-based pension when you reach 65, regardless of your employment status.

Once converted, the 10% annual withdrawal limit no longer applies, and the investment earnings within the account become tax-free, and that balance of your TTR pension at that time counts towards your transfer balance cap.

Yes, you can absolutely open a TTR pension using our online application process.

Simply select "FirstChoice Wholesale Pension" and complete the form.

When selecting “Pension Type”, make sure you tick ‘Pre-Retirement Pension’ which is another term for transition to retirement.

If you need assistance completing the online application form or have any questions, you can book an appointment with our guidance consultants, who are here to help.

Assumptions: The member is assumed to be in a taxed, accumulation style superannuation fund. Earnings on both super and the TTR income stream are assumed to be 4% pa income (taxed at 15%) and 4% pa capital growth (not taxed). Contributions and income stream payments are assumed to be made half-way through each financial year. The member’s gross employment income is assumed to stay the same throughout the projection. 2025–26 superannuation rates and thresholds, and income tax rates and thresholds for a resident individual, apply throughout the projection. All results are in future dollars.

Avanteos Investments Limited ABN 20 096 259 979, AFSL 245531 (AIL) is the trustee of the Colonial First State FirstChoice Superannuation Trust ABN 26 458 298 557 and issuer of FirstChoice range of super and pension products. Colonial First State Investments Limited ABN 98 002 348 352, AFSL 232468 (CFSIL) is the responsible entity and issuer of products made available under FirstChoice Investments and FirstChoice Wholesale Investments.

Information on this webpage is provided by AIL and CFSIL. It may include general advice but does not consider your individual objectives, financial situation, needs or tax circumstances. You can find the target market determinations (TMD) for our financial products at https://www.cfs.com.au/tmd which include a description of who a financial product might suit. You should read the relevant Product Disclosure Statement (PDS) and Financial Services Guide (FSG) carefully, assess whether the information is appropriate for you, and consider talking to a financial adviser before making an investment decision. You can get the PDS and FSG at www.cfs.com.au or by calling us on 13 13 36.

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