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Set up a retirement income stream
Ease into your dream retirement with an account-based pension
Ready to enjoy your retirement income?
An account-based pension lets you access your super as regular pension payments completely tax-free. Setting one up is simple with the help of our expert team.
Who is an account-based pension suitable for?
You'll need an Australian residential address to get started. Our account-based pension is designed for people in the following situations:
You're over 60 and retired
You’ve met a condition of release for your super.
You're over 60 and slowing down
You may be eligible if you’re between 60-64, and have changed employers since turning 60.
You're 65 or older
You can access your super regardless of your work status.
If you're over 60, still working and haven't met any of the criteria above for an account-based pension just yet, you might want to consider a transition to retirement (TTR) income stream.
Book a call with our guidance consultants so they can help you understand if this product is suitable for you.
Set up a tax-free income stream
Flexible income, your way
You choose how much and how often you get paid (as long as you withdraw the minimum each year), with freedom to adjust or access your money anytime.
Tax-free investment earnings
Switching your super over to an account-based pension means you won't pay any tax on your investment earnings. Unlike super, these earnings are 100% tax-free.
Your money stays invested
Your money remains invested and continues to generate earnings in retirement. In fact, more than 50% of your income could be generated from earnings after you've retired.1
Save $20,000 over 10 years with an account-based pension2
You’ll save money with an account-based pension because it’s the only tax-free environment for your super.
Let’s compare what retirement might look like for Mary, who opened an account-based pension, and John, who kept his money in super.
Mary retired at 67 and immediately put her $500,000 super balance into a CFS account-based pension. She then elected to receive pension payments of $25,000 each year for the first ten years of her retirement, to supplement her Age Pension.
On the other hand, John retired at 67 and decided to keep his $500,000 super balance in his account. He then withdrew lump sums of $25,000 each year from his super for ten years, to supplement his Age Pension.
After ten years, withdrawing a total of $250,000 from their super, Mary was left with around $20,000 more money in her account compared to John because she took advantage of the tax-free earnings environment in a CFS account-based pension.
After 10 years (withdrawing $250,000 total)
Simple steps to set up your account-based pension
Get your super sorted
Account-based pensions can only be funded with super, and you can't add more money once it has commenced. To maximise the tax benefits, consider topping up or combining your super before starting your account-based pension.
Customise your account-based pension
Decide how you'd like to invest your money - you can open your account-based pension using your existing super strategy, switch to an option tailored for your retirement years, or build your own from scratch.
Enjoy regular, tax-free income
Decide how much you'd like to be paid from your account-based pension, and how often. Enjoy the tax-free investment earnings as your super continues to grow. You can change your payment preferences, or withdraw a lump sum, at any time.
We’re here to help you retire with confidence
At no extra cost for CFS members, our guidance consultants can help you:
- Easily set up an account-based pension with our simple digital process.
- Better understand account-based pensions and retirement income streams, including how they can benefit you.
- Answer any questions you may have about retirement planning or super boosting strategies.
- Recommend more comprehensive financial advice, if that’s what you need.
Frequently asked questions
No, once an account-based pension has been opened, you can't contribute any more money or rollover amounts to increase your balance. You'll only have one opportunity to "top up" your account-based pension, which is why you should consider contributing money to your super, or combining super accounts outside of CFS, before you open one.
Your CFS pension will generally be included as a financial investment for the age pension income and assets tests, and may affect your age pension entitlement.
Find out more about Age Pension
Will my pension account affect the Age Pension?
Yes, you can withdraw a lump sum from your account-based pension, in addition to your regular pension payments. You can withdraw as much as you like, up to the full balance of your account, at any time. There are some things to consider, like potential tax implications and the impact on your Age Pension eligibility.
Yes, there’s a minimum amount you’ll need to withdraw from your account-based pension each year. This is based on your age and your account balance on 1 July of each year. The government sets a minimum withdrawal percentage, which increases as you get older. Learn more here.
1 Calculations by CFS. Projection starts at age 25 (with salary of $100,000), retirement at age 65 and super lasts until age 92. Superannuation earnings, tax on earnings, investment and administration fees, and yearly indexation of contributions and income stream payments, are based on the default assumptions used in ASIC’s Moneysmart calculator, available at moneysmart.gov.au as at August 2024.
2 Assumptions: Calculated using default assumptions from the moneysmart.gov.au retirement planner. Note that the default 7.5% pa gross earning rate used in that calculator for accumulation phase super has been used for both the accumulation and account-based pension calculations above. Withdrawals increase by 2.5% each year to keep pace with inflation. Results shown are in today’s dollars discounted for inflation of 2.5% pa.
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.