ING tool unlocks TTR strategies
ING has created a tool to assist advisers in implementing tax-effective transition-to-retirement (TTR) pension strategies for their older, medium-to-high income-earning clients.
From July 1, TTR rules allow workers aged 55 and over to roll their existing superannuation into an account-based pension, which provides them with a non-commutable income stream that is tax-free once they turn 60.
These clients can still work and can use a TTR strategy to supplement full-time or part-time wages, receive extra tax-effective income or accumulate a considerably larger super nest egg at retirement than they otherwise would.
ING’s online TTR Calculator is designed to help advisers implement such a strategy.
ING technical services manager Rudy Haddad’s advice to those who have reached or are nearing age 55 is to talk to an adviser to ensure significant savings are not missed.
“Under a very basic TTR strategy, a person would work part-time and continue to have compulsory 9 per cent super guarantee contributions made on their behalf,” Haddad said.
“The super income stream would then supplement their salary and lifestyle as they reduced their working hours.
“Clearly, for the best tax outcome, the ideal strategy would be to continue working full-time, aggressively salary sacrifice most of their work salary and live off a TTR superannuation income stream they draw down.
“For benefits received on or after age 60, there is no further tax to pay, so in terms of saving for and investing in retirement, super may provide significant tax savings.”
The new calculator is the latest in a series of financial planning tools launched as part of ING’s SuperCharge campaign.
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
