-TTR

Exec summary

We recommend you establish a Transition to Retirement strategy to help build your retirement wealth position.

STRATEGIC RECOMMENDATIONS

The ‘transition to retirement’ option is a government initiative that recognises that you may want to decrease your working hours over time towards the end of your career. It allows you to access your super benefits as an income stream prior to retirement. Many people use it as an opportunity to boost their super benefits overall or just to ease into retirement.

Step 1:

We recommend you establish an Allocated Pension fund and rollover $XXXX from your existing superannuation funds.

Once these funds have been received we recommend you commence a Non Commutable Allocated Pension and draw down XXXXX income each year (XX% of fund balance)

(Client Name)

Step 2:

Xxxxx, arrange to salary sacrifice $XXXXX per annum ($XXXX per month) from your salary into your XXXXX superannuation.

The table below outlines details of the purchase of your account based pension, including the first year pension payment summary.

Pension Summary / Name
Age when pension purchased
Gross amount invested into pension
Tax-free portion of amount invested
First Year Payment Summary
Minimum allowable pension payment
Maximum attainable pension payment
Recommended pension payment before tax
Pension payment frequency

(PLEASE REFER TO SECTION 6 FINANCIAL PROJECTIONS FOR CASHFLOW / TAX / RETIREMENT COMPARISONS)WEALTH

Additionally, I recommend that you nominate a reversionary beneficiary. A reversionary beneficiary is someone to whom the retirement income stream will continue to be paid following the death of the original purchaser.

Nominating a reversionary beneficiary is suitable due to <insert reason>

WHY MY ADVICE IS APPROPRIATE FOR YOU

(ADVISER TO ADD/DELETE AS TO SITUATION)

The recommended products will meet your goals and objectives by;

·  Maintaining the same levels of take home pay, but allowing you to contribute sustainably more to your superannuation fund.

·  Implementing a transition to retirement strategy will provide you with a tax effective income.

·  Implementing a salary sacrifice strategy will help to increase your savings for retirement as well as reduce tax payable on your income.

·  The recommended strategy will provide you with the desired levels of take home pay to maintain your day to day living requirements

·  Reducing your taxable income and therefore reducing your tax liability.

·  Investing your funds in a manner to suit you risk profile.

·  Providing you with tax effective income stream (and totally tax free over the age of 60)

·  Providing tax free investment earnings within the Account based Pension plan

·  Providing you both with an increased retirement nest egg for the future.

Nominating a reversionary beneficiary has several advantages.

·  First, it is convenient because the original pension simply continues to be paid to the nominated reversionary.

·  Second, the trustee is bound by a valid reversionary nomination thereby removing the trustee’s discretion to pay part
or all of the benefit to someone else.

·  And third, unlike lump sum beneficiary nominations which need to be renewed every three years, reversionary pension nominations do not need to be reviewed unless the original pension is stopped and then restarted.

risks of my recommendations

(ADVISER TO ADD/DELETE AS TO SITUATION)

·  If the income drawdown from the TTR pension is not replaced by way of making additional superannuation contributions, your final retirement balance may be less.

·  Income from the TTR pension may be received at different times to your current salary or self-employed income.

·  You pension may not last for the rest of your life. Your pension will be invested based on your risk profile and will rise and fall in value depending on investment performance and pension payments.

·  Part of the income you draw down from your account based pension may be counted for income test purposes for entitlements to Government income support (Centrelink)

·  Account balance of your account based pension will be counted as an asset for the purposes of determining any entitlements to Government income support (Centrelink)

·  Your pension will be temporarily non-commutable meaning that you will not be able to access any capital lump sums until you meet a retirement condition of release (but the pension can be stopped and the residual account balance rolled back to the accumulation phase).

·  When you die, the proceeds from your superannuation fund and account based pension may be subject to lump sum tax if they are paid as a lump sum to non-dependants, as defined for tax purposes.

There may be transaction costs involved in establishing the strategy