Marisawright Posted September 17, 2016 Share Posted September 17, 2016 I've always assumed that when the times comes for me to draw on my super, I'll convert it to a pension. It always seemed that withdrawing the lot and investing it was just silly, because it only means more tax. However, when my oh's brother was diagnosed with terminal cancer last year, he tried to withdraw the rest of his super to pay for treatment and have a big holiday before the end - only to be told that because he'd converted it to a pension, he couldn't do that. His widow would get the balance of the money on his death, but he couldn't access it while living. He was a bit of a bullsh!t artist so I'm wondering, is this true? If so, then I'm wondering whether converting to a pension is really a good idea. I mean, cancer is such a common cause of death and while I'm hoping we're going to last for years and years, you never know. Is there some benefit to a pension compared to leaving the money in super and withdrawing money as you need it? Is there some tax break that I'd be missing? Or some law that says it can't sit in super forever? Or that you can't withdraw it in dribs and drabs? When we were in England we simply transferred over money as we needed it in $25,000 lumps (thanks Moneycorp!). That worked well so I don't see why it couldn't work here. Quote Link to comment Share on other sites More sharing options...
NickyNook Posted September 17, 2016 Share Posted September 17, 2016 Most super funds will allow you to take full or partial lump sums from your balance once you're in the pension phase. I know ours does. Maybe your OH's brother had bought an annuity with his super (to guarantee a particular pension amount for his lifetime) and there was no lump sum left to take? Quote Link to comment Share on other sites More sharing options...
Gbye grey sky Posted September 17, 2016 Share Posted September 17, 2016 I've always assumed that when the times comes for me to draw on my super, I'll convert it to a pension. It always seemed that withdrawing the lot and investing it was just silly, because it only means more tax. However, when my oh's brother was diagnosed with terminal cancer last year, he tried to withdraw the rest of his super to pay for treatment and have a big holiday before the end - only to be told that because he'd converted it to a pension, he couldn't do that. His widow would get the balance of the money on his death, but he couldn't access it while living. He was a bit of a bullsh!t artist so I'm wondering, is this true? If so, then I'm wondering whether converting to a pension is really a good idea. I mean, cancer is such a common cause of death and while I'm hoping we're going to last for years and years, you never know. Is there some benefit to a pension compared to leaving the money in super and withdrawing money as you need it? Is there some tax break that I'd be missing? Or some law that says it can't sit in super forever? Or that you can't withdraw it in dribs and drabs? When we were in England we simply transferred over money as we needed it in $25,000 lumps (thanks Moneycorp!). That worked well so I don't see why it couldn't work here. Presumably making provision for his widow after he was gone didn't come into his thoughts. Quote Link to comment Share on other sites More sharing options...
Marisawright Posted September 17, 2016 Author Share Posted September 17, 2016 Presumably making provision for his widow after he was gone didn't come into his thoughts. Pretty much! Quote Link to comment Share on other sites More sharing options...
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