I want to … gradually transition to retirement 

You don’t always have to stop work straight away, some choose to retire gradually over time. This may mean reduced hours for a period of time but not wanting to compromise your lifestyle or fall short on financial commitments.


A transition to retirement (TTR) pension allows you to access your super while you are still in the workforce and can help you maintain your living standards and possibly reduce your overall tax liability. There are two popular strategies that help pre-retirees at this critical juncture in their lives:

  • Income Swap Strategy – This helps you ramp up your super savings when you are slowly approaching retirement. Additional super contributions are made via salary sacrificing while drawing down an income from your TTR pension to help fund your living expenses
  • Replacement Income – This strategy focuses on using income from your TTR pension so that you can wind down the hours and start to ease your way into retirement while enjoying the same level of after-tax income.


It is important to note that having good advice is essential as:

  1. Not everyone can access a TTR pension – A TTR pension is only available when you reach
    preservation age, which for most is the age of 60, that doesn’t mean that you shouldn’t speak to an adviser beforehand as not all super funds offer TTR pensions and the amount that you withdraw each year is capped at 10% of the balance of the pension. This means you may need to top up this account through contributions in the years prior so that your cash flow runs smoothly.
  2. Accessing a TTR pension can mean that you exhaust your retirement savings earlier – your super savings may need to last 20-30 years and withdrawing these funds early may have a significant impact in later years. This means that you will need to plan carefully and work out what you can draw out today and how much this may impact your future retirement savings.
  3. A TTR pension is not a ‘set and forget’ strategy – regardless of which strategy you use, a TTR plan needs to be reviewed annually so that income streams and contributions can be fine-tuned to fit your particular situation.


Speak to us today and we can help you put together your plan to help you achieve this and many of your other goals.

Let us know how we can help