Tracey’s story
Tracey is a mum of four grown up children and a grandmother to seven. As well as raising her children she juggled part-time work as an administration assistant, picking up more hours as her kids grew older.
She separated from her partner years ago and now lives by herself in a rented unit near the beach. Now 70, she’s been enjoying retirement for the past five years. Due to being in and out of the workforce, her super balance at 65 was $50,000 and she knew she would need to rely on the Government Age Pension to fund her retirement.
Before retiring, she spoke with one of First Super’s financial planners about how to make the most of her $50,000. They advised her to draw down on her super through a Retirement Income account to top up her Age Pension. That would maximise the amount of Age Pension she would receive and allow her $50,000 to continue to grow a little in the early years of retirement, before she gradually draws down on all of it.
Here’s what that looked like:
- Her super balance was $50,000 when she retired, which she converted into a First Super Retirement Income account.
- Over the past five years she withdrew on average around $2,529 each year to top up her Age Pension. For Tracey, that extra $2,529 comes in handy for the grandkids at Christmas time and to fund a holiday every year.
- Her annual income over the past five years (from her Retirement Income account and the Age Pension) has been about $30,695.
- Tracey experienced an average five-year First Super investment return of 6.48% (2018 – 2023)1.
- Today, First Super balance has grown to $53,269.
- If Tracey had switched to a retail super fund at retirement, her balance would only be $50,792.
That’s a difference of $2,477, simply because she stuck with First Super.
Tracey’s numbers
| Account balance invested after income taken |
Income stream payments | Age Pension payments | Total income | |
| 2018/19 | $50,000 | $2,500 | $27,102 | $29,602 |
| 2019/20 | $50,998 | $2,550 | $27,648 | $30,198 |
| 2020/21 | $47,855 | $2,393 | $28,181 | $30,574 |
| 2021/22 | $53,047 | $2,652 | $28,431 | $31,083 |
| 2022/23 | $50,980 | $2,549 | $29,468 | $32,017 |
| Closing balance | $53,269 |
We’re here to help. So, let’s talk
If you have any questions, call our Member Services team on 1300 360 988, email us or use the Live Chat. The 5% drawdown may not be right for you, so book an appointment with one of our financial planners to discuss your situation or click the link below to find out more about our Retirement Income account.
Tracey is not an actual member. Her story has been created for illustrative purposes.
1Past performance is not a reliable indicator of future performance and should never be the sole factor considered when selecting a fund.
Comparisons and modelling by SuperRatings, commissioned by ISA, and show average difference in pension net benefit results after the first 5 years of retirement of the main balanced investment option of First Super’s pension product and a sample set of retail pension products tracked by SuperRatings with a 5 year performance history to 30 June 2023 (23 funds), taking into account historical earnings and fees. The model assumes a drawdown amount of 5% per annum, which is deducted monthly. Outcomes vary between individual funds. Modelling performed on 6 October 2023 using data as at 30 June 2023. See retirement assumptions for more details about modelling calculations and assumptions.
First Super financial planners are authorised representatives of Industry Fund Services Limited (ABN 54 007 016195, AFSL 232514).
Issued by First Super Pty Ltd (ABN 42 053 498 472, AFSL 223988), as Trustee of First Super (ABN 56 286 625 181). This article contains general advice which has been prepared without taking into account your objectives, financial situation or needs. You should consider whether the advice is appropriate for you. Read the Product Disclosure Statement (PDS) before making any investment decisions. To obtain a copy of the PDS or Target Market Determination please contact First Super on 1300 360 988 or visit firstsuper.com.au/pds.