How Does Superannuation Work in Retirement? What Every Woman Needs to Know

How does retirement with super actually work, and how do you know when you've got "enough"? In episode 4 of our five-part series helping Aussie women get super at Super, proudly brought to you by Australian Retirement Trust, Molly sits down with superannuation expert Ruth to unpack exactly what happens to your money once you retire, practical answers for women who want to feel in control of their retirement income.

Whether you've been putting off thinking about "what happens next" with your super, aren't sure if you need to notify your fund the moment you retire, or just want to know how much is actually "enough," this episode is for you.

In this episode, you'll learn:

• Why you don't have to touch your super the moment you retire, and when it makes sense to leave it invested
• The difference between taking a lump sum and setting up an income account (and why most people don't realise they have a choice)
• Why your super keeps earning returns even after you retire, and why running out is less common than you'd think
• The real tax perks of moving your money into an income account after 60
• What "comfortable retirement" actually costs for a single woman vs a couple, in real numbers
• How the Age Pension asset and income tests work (and why your home isn't counted)
• How to think about your super independently from your partner's, including what happens if you separate or they pass away
• Why healthcare and aged care costs deserve a place in your planning, even though they're hard to predict
• The biggest mistakes women make with their super at retirement
• The single most powerful move you can make if you're 10 years out from retiring

Perfect for: Australian women approaching retirement, anyone who's ever wondered "do I have enough?", and women who want to make sure their super works as hard for them in retirement as it did while they were saving it.

The biggest takeaway from this episode? Your super doesn't stop working for you the day you retire, and there's more flexibility (and more of a safety net) than most women realise. 🎧

The opinions and comments shared by people in this podcast are theirs alone. The information was accurate at the time of recording. This is general information only and is not based on your personal objectives, financial situation or needs. You should consider these factors and read the relevant Product Disclosure Statement and Target Market Determination before making any decision about any financial product. If you’re still unsure, speak with a financial adviser.

 

CHAPTERS

00:00 - Introduction: What Retirement Actually Looks Like for Australian Women in 2026
01:49 - Busting the Biggest Super Myth: You Don't Have to Touch Your Super When You Retire
03:44 - What Is an Income Account? How to Turn Your Super Into a Regular Pay Cheque
05:43 - Scared to Spend Your Super? Why Retirees Live More Frugally Than They Need To
08:37 - How Much Super Do You Actually Need to Retire Comfortably in Australia?
10:47 - Account-Based Pension vs Lump Sum: The Two Main Ways to Access Your Super
12:55 - Setting Up an Income Account: How the Process Actually Works
13:59 - Tax-Free Super Withdrawals After 60 (And Why Income Accounts Pay Less Tax)
15:44 - Can You Run Out of Super? Here's What Really Happens to Retirees' Balances
17:09 - The Age Pension Explained: Meeting the Asset and Income Tests
18:15 - "You Can't Eat the Walls": Why Your Home Doesn't Count Toward the Age Pension
19:40 - Why Every Woman Should Plan Her Super as If She's Single
20:41 - Super, Divorce and Death: Why Beneficiaries and Binding Nominations Matter
22:49 - Separation and Super: Why Women Shouldn't Be Afraid to Claim Their Share
23:33 - Planning for Healthcare and Aged Care Costs in Retirement
24:15 - The Retirement Spending Curve: Why Your First and Last Years Cost the Most
25:42 - The Biggest Super Mistakes Australian Women Make at Retirement
27:09 - 10 Years From Retirement? Here's the Biggest Lever You Can Pull Right Now
29:34 - Outro: Final Thoughts on Getting Super at Super

  

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TAKEAWAYS

SOUND BITES

 "This is why we love investing. People 10 years into retirement will often have more money than the day they started, because they are earning more than they are taking out."
"You can't eat the walls."
"Your home is a good asset and everything, but it doesn't feed you."
"When you're earning an income, you're earning two, really, you're earning your everyday income, and you're also building that super."
"It's not a set-and-forget with the Age Pension, you might not get it all, but you might get some, and then, in time, potentially qualify for more."

 

TRANSCRIPT

[00:00:00] Welcome to our special five-part Get Rich series on superannuation, where we are helping Aussie women get super at super. This series is proudly brought to you by the Australian Retirement Trust, trusted by over 2.4 million members. So over the next five episodes, we are making sense of super, so let's get into this week's episode. 

[00:00:19] And just a quick note, everything we cover is general information only and does not take into account your personal situation, so consider seeking professional advice before making any big finance or fashion decisions. 

[00:00:36] So we're back with another episode of helping Aussie women get super with Super. And this one is all about how do we actually, like, how does retirement actually work? Like, the process, 'cause I actually don't know. What does retirement actually mean for women in Australia in 2026? Has the definition changed? 

[00:00:54] Are we retiring in full? 

[00:00:56] Generally, no. Mm. That old concept of working right up to a certain age and then stopping and being full-time at work and full-time retired- Mm ... is actually less common than you think. Yeah. 

[00:01:07] I think it's far more common these days for people to retire more than twice. Yeah. 

[00:01:12] So maybe going part-time initially or maybe retiring and doing a bit of contract work. 

[00:01:18] Yeah. Sometimes people will retire and realize, "Mm, this is not as-" Don't like this . "I don't like this," or, "I'm sick of sitting at home-" I'm bored ... "with my husband," or whatever, and they've decided maybe they'd like to go back to work. Yeah. So it's far more common these days, Molly, for people to retire, dabble a bit with it, and retire a couple of times. 

[00:01:33] So it's doesn't have to be so black and white anymore. 

[00:01:35] Mm. And so let's say we've got Sue and she is about to s- hit retirement age. Talk us through what would Sue do when she goes, "Okay, I'm gonna retire at 60." Yeah. What's Sue's next steps? 

[00:01:51] Well, one of the myths that's, uh, I need to, uh, bust, if you like- Yeah 

[00:01:55] is that you do not need to touch your super if you don't want to. Okay. An awful lot of people think that they're supposed to do something with their super when they retire. Yeah. And in actual fact, maybe you don't need to. You might have a spouse at home that's still working. Mm-hmm. Yeah And there's still income coming in. 

[00:02:10] Yeah. And you don't need to take your super out. Yeah. So until you're ready and willing and able to access it, you can leave it there- Mm-hmm ... and it will continue to be invested. It will continue to earn investment returns for you. And then when you want to start accessing it, then you contact your super fund. 

[00:02:28] But there, you do not have to access it, you do not have to advise the super fund you've retired, until you're ready to start taking the money out. 

[00:02:35] Now, let's say Sue is ready to, like, hit up her retirement savings. How does that work? Do you have to notify your super fund? Do you just... Like, how do you make that, how does the switch happen, I guess? 

[00:02:47] Well, first of all, Sue would need to decide how does she want to access the super. Yeah. So is she wanting to just do a lump sum withdrawal, for example. Yeah. So when you get there and you're ready to spend your money, there's a couple of different ways that you can structure- Okay ... your super. You can leave it there and just take money out as you wish. 

[00:03:04] Yeah. So for example, you could take a $10,000 or a $20,000 withdrawal. Mm. You could take it all. Yeah. That's not very common, but you could. And it's tax-free, so once you're 60- Okay, yeah ... and you're withdrawing your money, it's tax-free. So Sue might decide, "Oh, I'm only gonna take it out maybe once or twice a year. 

[00:03:20] I'll take a lump sum-" Yeah ... "and see how long it lasts." That's probably not that common, though. Yeah. A lot of people get used to, during their working life, to having a regular flow- Yeah ... of income and having a bit of a budget to work 

[00:03:33] from. Yes, and it's much more, I think, easy to manage as well. That's right. 

[00:03:36] It sort of stops you from overspending, you know- Yeah ... in any one particular time, 'cause you're, you're still getting paid. Yeah. You're just getting paid from your own superannuation balance. What's probably more common is to move your money into what we call an income account- Okay ... or an income stream. 

[00:03:50] Yeah. Depending on the f- the super fund, they might have slightly different terminologies. And really, that's your way of saying, "Okay, I'm gonna move it out of the accumulation or the superannuation stage into an income stream or income account stage, and I'm going to tell the fund how much I want to be paid." Okay. " 

[00:04:08] And I'm also going to tell them how often I want to be paid." So Sue might say, "Well, I'm going to move my 300,000 into an income account, and I'm going to ask my fund to pay me 2,000 a month from there." Okay. 

[00:04:22] And she's in full control. There is no maximum, so Sue is not limited. There's no rules that she can only take a certain amount. Okay. 

[00:04:30] Once she's retired, she can take as much of it as she wants, so Sue might have an awesome first year of retirement and- Ooh ... spend up big. Uh, or she might decide to also take a lump sum whenever she wants. It's quite flexible, actually, and there's a lot you can do. And lastly, when you are in that income phase and you're telling the fund how much you want to be paid- Yeah it's still invested. Okay. 

[00:04:52] So you're still earning returns on 

[00:04:54] it. Yeah. Okay, good to 

[00:04:55] know. And you can change your mind. Mm. So very often you might say, "Well, I don't really need the money anymore." The reason I say you can change your mind and convert it back is because there is a minimum. Mm. 

[00:05:05] Right? So if Sue did that, she would have to take at least 4% of the balance- Okay throughout the year. Okay. 

[00:05:13] Right? But there's no maximum, and that minimum amount will increase a little bit as Sue gets older. Oh. 

[00:05:19] But it's a lovely way to structure- Yeah ... your money, that, you know, you're, you are not limited in how much. But the government want to make sure that if you're putting it into this environment, you're at least taking a reasonable amount. 

[00:05:31] Mm. So there is a minimum- Yeah, minimum ... but there is no maximum. 

[00:05:34] I feel like for some people who might be just natural spenders and they're not great with budgeting, can that get a little bit dangerous? Yeah. Because all of a sudden they're spending- Mm ... just so quickly through their super? 

[00:05:46] You would think that that would be the case. 

[00:05:48] Yeah. But I think what we tend to see is the opposite, Molly. Okay. 

[00:05:52] I think what we see is people scared to spend it. Mm. 

[00:05:56] And they generally will say, "Well, okay, if I invest my money, I don't want to spend any more than what the investment returns are." Yeah. "I don't want to see the capital deplete." Go down. And what actually happens is people end up living far more frugally- Yeah than they need to. Yeah. 

[00:06:12] And they're scared to spend it, so you know, there is the saying, "You can't take it with you." Yeah. 

[00:06:16] So that's where I suppose getting a bit of advice and saying, "Well, you know, can I actually afford to spend a little bit more?" Mm. Of course there's going to be exceptions. Yeah. There are going to be, you know, spendthrifts out there that think- Yeah 

[00:06:27] "You know what? I've worked long and hard, I'm just gonna go hard for the first couple of years." Yeah. 

[00:06:31] And, and that might be the case, but we tend to see the opposite actually. That's- A fear of spending it. 

[00:06:35] Yes, that's interesting, but not super surprising. Yeah, 

[00:06:39] yeah. And just with that, and I don't know if you have this information, but Kit, once people sadly pass, can you see if people h- actually are leaving lots in their super fund? 

[00:06:49] Yeah, they are. So we are in a, in a time where the amount of wealth, so intergenerational wealth- Mm ... is huge. We are not seeing people spend their superannuation. We are seeing, exactly as I said, um, it's a huge part of inheritances coming into- Yeah ... particularly that Gen X- Yeah ... or that sandwich generation we spoke about. 

[00:07:10] Um, and a lot of it is coming from superannuation. Interesting. So there is, I suppose, an awareness out there that might be lacking around- Mm-hmm ... 

[00:07:19] not being so scared to spend it that you're living so frugally. Yeah. And in the same breath, the opposite being true too, you know, there is no limit on how much you spend, so be careful. Yeah. 

[00:07:29] So it is a conversation you should be having, I think, with, with professionals, like how much- Yeah ... 

[00:07:34] could I reasonably take? And you can't take it with you, so the idea of it is to spend it and enjoy your retirement. Yeah. You know? That's the whole point of it. 

[00:07:42] And whenever I speak to, um, professionals in the industry, a lot of them will say, "Go get advice." 

[00:07:49] Which is all well and good if you can afford financial advice. For, for people who are like, "Ooh, I don't know if I can afford financial advice," is there like- Go to your super fund for advice. Is that the next best thing? 

[00:08:01] So there's different types of advice. Okay. What you and I are doing here today, and what I'm doing here today- Mm-hmm 

[00:08:05] is general advice. Yeah. So I haven't factored one person's situation in, but I'm giving you a lot of information which you can then go and apply to yourself. If you're wanting personal advice, a lot of super funds will also offer that. Mm-hmm. So ART members, for example. Yeah. I'll use our fund as an example. 

[00:08:21] Our members can get personal financial advice- Mm-hmm ... about how to structure their super balances in retirement and, you know, help to set it all up, and that's part of their membership. Mm-hmm. So it does depend. Talk to your fund. Yeah. Find a fund that can support you, um, and start there. And if they can't help you, then you go and maybe look outside. 

[00:08:40] Mm-hmm. And how does a woman actually know when she's ready re- to retire? Not emotionally, but, like, from a super perspective. I know we've talked about it in past episodes, but what does that number look like? 

[00:08:52] The number is so personal. Mm-hmm. Um, it's probably one of the most common questions we get is, "What should, how much should I have?" 

[00:08:58] Yeah. Yeah. You know, "Do I have enough?" Yeah. And it really does depend. You know, if you're retiring as a couple, so if you're, if you're a woman listening and you've got a, a spouse, you're combining your assets- Mm ... right? So the pressure isn't on you as much. You're also splitting costs, okay? So when you're factoring in how much you need, it's going to be a lot less if you're combining assets and splitting costs. 

[00:09:18] If you're retiring as a single person, you don't have anybody to combine assets with. Mm. And you never pay half a rates bill or half an electricity bill. You've gotta, the- Yeah ... pay the full bills. So if you're a, a single person, let's just say, and you're wanting to live a comfortable retirement, and we've talked about w- well, what does that mean? Yeah. 

[00:09:38] It means very different things to different people. But if you look at the current research that's done around Australia on people who are retired now- Yeah ... 

[00:09:46] a single person would say, "Look, if I'm retired, I would class somewhere around 50 to 55-odd thousand to be pretty comfortable. Not luxurious, but comfortable." Mm. 

[00:09:57] And if you're a single person, and you think, "Yeah, that, that income, you know, about 1,100 a week or in or around that value-" Mm-hmm ... "I think that'd be pretty good," well, then, for you to achieve that right throughout your retirement if you retired at 65, you would need to have about 600-plus thousand in your super. 

[00:10:16] A lot of people are taken aback by that, and they get very worried by that. Mm. And I just say, "All you've got to do is maybe reduce that income down a little bit." Mm. "And that will significantly drop what you're going to need- Yeah ... in retirement." And there's a lot of considerations and assumptions and things behind that number, but it'll give you a ballpark to work with at least. 

[00:10:35] If I find myself single when I hit retirement, I'm gonna find some girlfriends to live with. Because that is gonna reduce my expenses. Costs. And costs. 

[00:10:42] Yes, I always say, you know, electricity bill, you can't turn half a light on. 

[00:10:47] Candles. All right. So there are two main ways to access super in retirement, account-based pension and taking a lump sum. 

[00:10:55] Can you walk us through the difference and when each might make sense? 

[00:10:58] Okay. So we'll start with the lump sum- Okay ... 'cause that's probably a little bit easier to explain. So you've got your superannuation balance, you are retired, and you don't want a regular flow of income. Mm. You just want to access your money when and if you need. 

[00:11:13] Yeah. You would do that by contacting your fund. You can actually, when you make the first withdrawal- Mm ... you can then put your request through digitally- Okay ... in most funds. You don't have to- Mm ... always ring up the super fund. Yeah. There is a process. Now, not every fund will have that- Mm ... but a lot do. And you would have to verify, you know, there'd be lots of identification- Yeah 

[00:11:30] and things to put in, particularly for that first withdrawal. But it's a quite a simple... Think of it a bit like a banking- Yeah ... 

[00:11:36] transaction. You're just telling your fund, "I want access to my money." Mm. And they will put that money into your bank account. Mm. And you take it when and if you want. That's where leaving your money in the superannuation system, and that's probably a fairly common approach- Yeah 

[00:11:50] for people who still have income coming to the household. Yeah. So spouses are still working, for example. Or you might have an investment property or two, and you think, "Well, the super is great, but I don't need it for income." Yeah. "I might just take it as a lump sum- Okay ... when I need." Yeah. 

[00:12:04] That's probably the least common way that people do it. 

[00:12:07] Yeah. And often, uh, people do that because they don't know there's an alternative, which is the account-based pension- Yeah ... or sometimes it's an income account or an income stream. Yeah. All the same thing, just different- Yeah ... terminologies. Oh, 

[00:12:17] okay. So that's all the same thing. 

[00:12:18] Yeah. Ah. So you might hear it in your fund as an income stream or an income stream account or an account-based pension or- Ah 

[00:12:26] an income account. Okay. It's really just converting your superannuation into a flow of income. 

[00:12:31] Which is what we were talking about earlier. 

[00:12:33] Which is exactly what we spoke about. And it, if you have it in an account like that, it means you don't have to ring your fund every fortnight- Okay ... or month and say, "Can I have some money?" 

[00:12:41] It's set up so that the payments are scheduled to go to your bank account- Great ... at a particular frequency. 

[00:12:47] And to set that up, do you just call up your super fund, or do you do it online to let them know that, "Hey, I'm gonna be getting $2,000 a month"? 

[00:12:55] So depending on the fund. Yeah. Say, I'll use ourselves as a benchmark. 

[00:12:59] Yeah. Yeah. Um, if you was, if you were an ART member, you can actually set it up yourself. You could do it online. So you can actually go through the whole process- Yeah ... yourself online. I'll be honest, a lot of people prefer to speak to somebody. Yeah. So you can ring up, and the online application is done together with someone from the contact center, as an example. 

[00:13:16] Yeah. There's still the old paper-based form. Yeah. So you can still fill out the application. And on the application form, you're really saying how much of your super balance you want to roll- Mm-hmm ... 

[00:13:26] move into this account, and then how much you would like to be paid and the frequency at which you'd like to be paid. 

[00:13:33] Mm. Now, I've said it in previous episodes, there's not many decisions you make in super that you can't reverse. Yeah. So if you say to the super fund, "I want to be paid, you know-" You could do it as a, as a number, so 30,000 a year. And then next year you realize you didn't need it all, you wanna drop it back- Mm-hmm 

[00:13:49] if, if you're within the limits, the minimum amount. Or you can say, "Next year I wanna have a bit more." Mm-hmm. "I was a bit short." You can move it as oft- you can change the amounts- Okay, great ... 

[00:13:57] throughout the year, and you can change the frequency. So it's really, it's really agile in that way. 

[00:14:02] Fantastic. And you mentioned before the money's tax-free. 

[00:14:04] Is that always the case when it comes to super? 

[00:14:07] When it comes to withdrawing- Yeah ... as long as your money is coming out of super after the age of 60, you will not pay tax on the withdrawals. Mm-hmm. Now, tax is also a consideration when we think about the income accounts. Mm-hmm. And the reason it's quite an attractive place for people to move their money is because when you're in an income account, so you've moved your money in here- Mm-hmm 

[00:14:28] and your fund is paying you a certain amount. Yeah. Remember, it's still invested. Yeah. You might be in the balanced option, for example. The difference is super funds do not have to pay the ATO any tax on the earnings in that stage of your super journey. Okay. So a lot of people don't realize that you and I today, Molly, we have superannuation accounts. 

[00:14:50] Yeah. And we'll get an investment return from our super fund. Yes. Yeah. 

[00:14:54] That super fund, before it gave you that return, had to pay 15% earnings tax to the ATO. Yeah. It's got nothing to do with your tax rate, but the super fund has to do it. Okay. But when you move your money into the income account- Mm-hmm 

[00:15:07] the super fund does not have to pay 15% earnings tax to the ATO. Mm-hmm. Okay. 

[00:15:12] So what that means is you might be in the balanced option still, but you're getting a slightly higher return- Mm ... 

[00:15:19] because the taxation is different internally. Okay. 

[00:15:22] Because the fund doesn't have to pay the tax. Doesn't have to, so. 

[00:15:24] The money that comes out, as long as you're over the age of 60, you will not pay tax on the withdrawals either. 

[00:15:30] And you mentioned if you're getting your super, uh, 60 or above, it's tax-free. What if you're under? 

[00:15:37] It's difficult to access if you're under. Okay. Yeah. So if 

[00:15:40] you're- Generally it's quite bad circumstances, isn't it? Yeah. 

[00:15:42] Yeah, generally through things like financial hardship and compassionate grounds. Mm-hmm. And there is taxation to think about then, but you can't re- access it under the retirement clause until you're 60. Okay. Do people run out? Of super? Yeah. 

[00:15:54] Yeah. I think there, th- there are people that will run out of super. 

[00:15:57] Mm-hmm. You know, the age pension is there as a safety net because people will run out- Yeah ... number one. Um, but also it's very much a, um, um, a thing about how you approach finances as well. So think about, you know, there will be some people out there that think, "You know what? I've worked so hard. I just want a couple years- Yeah 

[00:16:16] and I, and I'm just gonna spend it." Yeah. And there's, there's no stopping you spending it. Mm-hmm. Um, 

[00:16:20] and so maybe you just didn't build up enough- Yeah ... and you can only- You run through it quickly ... it only lasts so long. Yeah. 

[00:16:25] I think, though, it's less common than you realize, and the reason is it's always invested. Mm-hmm. 

[00:16:31] So you might open your income account with 300,000. Mm-hmm. But if, if you had a great year on the share markets- Yeah ... and the investment performances were really good, you might have earned 30,000 in that year on that. Mm-hmm. But if you only took 20,000 out, you're starting the next year with more money- Yeah 

[00:16:49] than you began, even though you took 20 out. Took money out. This is- We see that more- Yeah ... than people running out. 

[00:16:54] And this is why we love investing. 

[00:16:56] This is why investing is so powerful. It's so powerful. 

[00:16:58] That people 10 years into retirement will often have more money than the day they started because they are earning more than they are taking out. 

[00:17:06] That's nice to know. It is 

[00:17:07] reassuring. That's really nice to know. Yeah. Reassuring. It is. 

[00:17:09] And with that age pension- Like you mentioned, if you get access to it. Yeah. So do, like, is there, like, a test? 

[00:17:17] Yeah, there's a couple of things you have to meet. Number one, age. Yeah. So you cannot apply for Age Pension until you're 67. 

[00:17:23] Mm-hmm. In actual fact, they tell you to start the process about 13 weeks before you hit 67. Yeah, that's right. So if you think you'll be eligible, a couple of months before you turn 67, put your application through. Mm-hmm. 'Cause it takes a little bit of time for the whole system- Mm-hmm ... to, to, to- Mm-hmm ... do its thing. 

[00:17:41] But 67 is where you can become eligible. You also have to be a resident for at least 10 years- Mm-hmm ... in Australia to qualify- Okay, yeah ... for it. So they're the first two things. Okay, and move on to the next screening or the next testing, and the way they, Centrelink, uh, apply two tests. They apply an asset test, and then they apply an income test. Mm. 

[00:18:01] And whichever one of those gives you the worst result- Yeah ... 

[00:18:05] that's the one they'll use. Okay. 

[00:18:07] So we have a joke in the industry where we say that's why they call it means testing, 'cause it's mean. They give you the worst result of the testing. Okay. So when it's asset testing, they are looking at what do you own, what's your super balance, for example. 

[00:18:22] Mm-hmm. Do you have an investment property? What are your assets? Okay. 

[00:18:25] Molly, the one thing that's so important to know is your hou- your own principal place of residence- Mm-hmm ... is not an asset. Yeah. 

[00:18:33] So they do not count that. And then they look at your income, and there are thresholds. So a lot of people might not qualify for the full amount, but they might qualify for the part. 

[00:18:42] Okay. It's not a set and forget with pen- with the Age Pension. You, you know, you d- you might not get it all, but you might get some and then, in time, potentially qualify for more. 

[00:18:50] Ah, yep. I did not know your, your place of residence was not considered. 

[00:18:54] Yes, that's exempt. And look, to be honest, if, if we looked at the thresholds, if you're a couple in Australia today- Mm-hmm 

[00:19:00] and you're being assessed for Centrelink, you can have over a million dollars, so just over a million dollars- Mm ... in assets. Mm-hmm 

[00:19:07] Before you lose all Age Pension entitlements. Yeah. If you've got under about 450 as a couple, then you could still qualify for the full amount. Now, they're, they're rough numbers. Mm. 

[00:19:17] In between, you might get a little bit of Age Pension. But if you think about the current price of housing. Yeah. 

[00:19:23] If we included the principal place of residence, I don't think anyone who owns a home would qualify for Age Pension. Yeah, no, true. 

[00:19:28] And, you know, your home is, is, is, it's a good asset and everything, but it doesn't feed you. 

[00:19:33] You can't eat the walls. No. 

[00:19:35] So it's not really an income- Yeah ... generating asset- Yeah ... or an asset that can support you in that regard. 

[00:19:39] Yeah. Well, that's great that they see it that way. Yeah. 

[00:19:42] Clearly, very smart people have come up with this strategy. Yes. 

[00:19:44] So a lot of women, as part of a couple, have spent decades deferring to a partner's super strategy. 

[00:19:50] How should women think about their super independently from their relationship, and what happens financially if that relationship ends or the partner passes away? 

[00:20:00] Well, first of all, if you're thinking about your superannuation balance- Mm ... I always suggest that just think of, assume yourself as single- Mm-hmm 

[00:20:08] when you're doing forecasting. Okay. 'Cause that'll give you what the worst-case scenario is. Yeah. 

[00:20:11] Yeah, that's a good point. 

[00:20:12] Yeah. So if I'm doing a, a modeling or using a retirement calculator, for example- Yeah ... and it asks are you part of a couple or not, I usually start by suggesting no. Okay. 

[00:20:21] And then that's giving me, well, what's the worst-case scenario? 

[00:20:23] If something did happen- Mm ... and I only have my own super balance, what does that translate into? Mm-hmm. And then I'll go back and do it again and say, "Yes, I am part of a couple"- Mm ... and put my husband's details in. So I think it's really important that you always have a grounded understanding of your worst-case scenario- Yeah 

[00:20:41] as well as what might be the reality for you. If the relationship ends, you know, the thing with superannuation is it is an asset when it comes to family law and splitting. Mm. So I think a lot of people forget that. Yes. A lot of women, in particular, don't think about that. Yeah. And they've often sacrificed their ability to build superannuation so that their partners can go out and earn. 

[00:21:04] And when you're earning an income, you're earning two, really. Mm. You're earning your everyday income, and you're also building that super- Super ... which converts to income when you're retired. Yes. Right? Mm. 

[00:21:13] And a lot of women have sacrificed the ability to do that. Mm. So super is definitely something to be mindful of in that case. Mm. 

[00:21:19] In the event that, you know, things shift and your partner passes away, well, then thinking about the beneficiaries, and we talked about that in one of the other episodes as well, where- Mm ... it's so important that you don't just look at your account. Yeah. 

[00:21:32] Who's my beneficiary with my super? Is your partner's superannuation set up? 

[00:21:38] Mm. Do they have a beneficiary- Yeah ... if that money is meant to go to you? Because I know lots of women, not just women, but lots of members, who've had difficulties trying to get death benefits and super paid out to them- Mm ... because there's no beneficiaries. Okay. 

[00:21:51] So if you're looking at that kind of thing- Mm-hmm 

[00:21:53] yes, look at your own, but also say, "Well, if something happened to my husband- Yeah ... or my partner." Do I know where their super is? Yeah. 

[00:22:01] Do I know how to, how to put a claim in? Mm. Am I a beneficiary on it? So- Yeah ... there is a little bit of thinking around that as well. 

[00:22:08] Okay. And let's say worst case scenario, someone's partner passed away. 

[00:22:12] Would you contact their super fund? 

[00:22:15] So if someone's partner passed away, you can contact the super fund- Yeah ... to say, "This is the member. The member has passed away." Yeah. "I'm the spouse." Um, and they will require some paperwork- Yeah ... obviously, like a death certificate- Yeah, of course ... and things like that. But I can tell you now, your experience as a widow, if you are ringing up a super fund to try and get a death claim- Mm 

[00:22:36] and that process started, if there is a beneficiary, particularly a binding beneficiary, that experience is going to be so much easier- Yeah ... for you compared to if there's not one. 

[00:22:46] Same if you don't have a will. So ladies- ... get onto it. Binding nomination and your wills, add it to your to-do list. Yes. And then something I just wanna talk about just really quickly is I hear a lot of women, when it comes to separation and divorce, which we know that, that rate is going higher and higher every year, they'll say, "Well, I don't wanna touch their super because it's not mine." 

[00:23:06] And I'm like, "Well, you've given up so much of your life, your career, your earning potential, your super, so they could get in front with their career." Yeah. And they wanted a family. And so, absolutely, you know- 

[00:23:17] It's a sacrifice, yeah, that many women make- Yeah ... is that ability to accumulate their own- Yeah retirement wealth. 

[00:23:22] So please do not think that you don't have any claim to that at all. But as you said, in the flamy- family law, they'll put that, all the assets into a bucket, and then they divvy them out- Mm ... how they see fit. Now, I just wanted to talk about heal- healthcare and aged care because these are big costs, um, that can really kind of, I guess, impact your retirement planning. 

[00:23:43] So what should we be thinking about? 

[00:23:45] When it comes to healthcare and aged care, they're, first of all, they're unknown expenses. Yeah. Because you don't know- Of course, yeah ... if you're going to need 

[00:23:52] either of them. I need 150K. Yeah, you just don't know. Yeah, 

[00:23:54] you've no idea what you're likely to face when it comes to- Mm 

[00:23:58] looking after your health or, um, even needing aged care support. I would say don't, you know, don't overthink that for the shorter term. Yes, factor it into your planning. You absolutely need to be mindful of it. But you're trying to plan for a very unknown- Yeah ... thing, okay? So just being mindful of that. The other thing to think about with how much super do I have and how much should I be factoring in, your most expensive years- Mm 

[00:24:23] of your retirement journey will be the first few and the last few generally. Yeah. Right? The first few years, you're excited. Whoo. Let's spend, spend. Let's do the trip. I've got a list here- Yeah ... a bucket, a bucket list that I've created. I've got 

[00:24:34] energy. I'm feeling good. I'm feeling healthy. 

[00:24:36] This list. Yeah. I have my health. 

[00:24:38] Mm. I've got... You know, I'm just retired. I have that enthusiasm. I wanna do all these things. Mm. So you kind of spend a lot- Yeah ... 

[00:24:44] generally in those first few years, and then there's a bit of a plateau. Mm. You're starting to get a bit tired, and you don't really- ... want to be doing as much traveling and things like that. 

[00:24:51] Yeah. And we see the spending levels sort of flatten. Yeah. 

[00:24:55] But then it's those last few years we really see that start to spike again. Mm. And that generally, Molly, is the, the health costs- The costs ... start to trickle in, and particularly aged care, which is a very complicated area- Mm ... and does require- Specific expert advice on structuring your assets and planning for aged care. 

[00:25:13] So if that's something that you're worried about, um, or you're experiencing it with your own parents- Yeah ... which is where a lot of people start that aged care journey- Mm ... is actually with their own parents, and they realize how complex it is. Yeah. It's definitely part of the financial planning process. 

[00:25:28] Yeah. We are definitely looking into doing an aged care podcast because it's just- Yeah, it is ... we get a lot of questions on it, and it- Yeah ... it sounds like a bit of a minefield. 

[00:25:36] It is a bit of a minefield. It's complicated, for sure. 

[00:25:38] So what are the biggest mistakes women make when they hit retirement with their super, and are there any we should be looking out for? 

[00:25:46] Probably not asking for support or guidance in how to structure it. Okay. 

[00:25:52] Yeah. So remember I said, you know, you can leave it there as it is- Yeah ... um, and take it as you need, or you can move it into an income account- Yeah ... which is tax effective and, you know, it's, it's very convenient, and it pays you a- Yeah 

[00:26:04] regular income. Um, that's number one, is just assuming that they have to take it, um, and assuming that there's no other products available for them. Um, the other thing, I suppose, they, they forget, or people, you know, you know, often don't factor in, is the fact that it is still invested. Mm. It's the biggest misconception, that- Yeah 

[00:26:23] they think that the balance the day they retire is the balance, and they have to make that balance last. And as I've said, very often, more often than you would believe, people end up passing away with more super- Yeah ... 

[00:26:37] than the day they retired, because they are spending less out of the account- Mm ... than they are earning. 

[00:26:42] So don't underestimate what you can do with it. We want people to enjoy retirement. Mm. You've worked a long time to get there. Yeah. 

[00:26:50] So just balance it out. Don't get too excited and, and- Yeah ... deplete your capital really quick, but don't go the other route and live frugally and miss out on things- Yeah ... 

[00:26:58] for fear of spending as well. 

[00:26:59] Mm. There is a happy medium 

[00:27:02] Definitely. You wanna hit that happy medium. And I guess if a woman is around, like, 10 years from retirement, what's the most powerful moves she can make right now to set herself up? 

[00:27:12] Okay, if you're 10 years from retirement, the biggest lever you're gonna have to work with is your contributions. 

[00:27:18] Yeah. So do you have the capacity to get any extra money in there? Yeah. There's different ways to get the money in. Maybe if you're working, you're looking at the concessional route- Yeah ... which is the employer's contribution. So that 15% taxed 

[00:27:32] one. The 15% taxed one, the money from the employer, the money from- Mm 

[00:27:36] salary sacrifice. That's one type. But then there's also the after-tax contributions, and this is money from your bank account. Yeah. It's your own money. Mm-hmm. 

[00:27:44] If it's in your bank account, it's already been taxed, right? Yep. So that's money that you can contribute into your superannuation. You're not looking for a tax concession. That's called after-tax. 

[00:27:54] So you can just literally, like- Yeah ... like how I was transferring money to someone, a friend- Some- yeah ... 

[00:27:58] I can transfer it to my super fund. It's 

[00:27:59] just moving it from- Yeah ... it's like moving it in between bank accounts. Okay, yeah. So, you know, think of your super like a bank account- Yeah 

[00:28:05] and say, oh. Now, that kind of thing becomes quite common when maybe you sold an asset or you s- you had shares and you sold them. Yeah. Or you had an investment property that you sold. Yeah. Maybe you received an inheritance. Mm. So there's quite generous rules there around getting money in- Yeah ... if it's just from the bank account in and you're not looking for tax concessions. Okay. 

[00:28:23] And I guess the benefit there, and again, correct me if I'm wrong, but the benefit of doing that as opposed to just leaving my bank account till I hit retirement is I can take it out tax-free later on. 

[00:28:33] Absolutely you can. Yeah. So if you've got it sitting in the bank account, it's invested in one thing. Mm-hmm. Cash. Yeah. 

[00:28:39] Right? And also, if you've got a lot, and you've got a lot in your bank account- Mm ... you're also subject to tax on the earnings of it, right? Yeah. If you've got your money in superannuation, it's invested in a lot more than just cash generally. Yeah. So you've got potential for it to grow quicker for you. 

[00:28:54] Yeah. The older you get, so by older, I mean the closer to age 60 you get, the shorter the timeframe before you're able to take it back out again. And that's one of the risks with super- Yeah ... and putting money in, is what if I need this- Yeah ... before I- Yeah ... before I reach the eligibility- Of course, yeah ... to take it out. 

[00:29:11] It's one of the reasons why when we're young we think, "Oh, I've got so many things I could do." Tomorrow's problems, yeah. Yeah, there's lots of things. Like, what if I ever need that money again? Yeah. That risk depletes as you're getting closer and closer to retirement. Yeah. So y- you know, you have that kind of comfort of knowing, you know, if I'm 55 and I'm putting a big lump sum in, I know that come 60- Mm 

[00:29:30] there's ways for me to start to be able to access that again. Yeah. 

[00:29:33] Awesome. Well, Ruth, thanks for helping Aussie women get super at Super. You are welcome. 

[00:29:39] Thanks for listening. Now, remember that this was just general information and it might not be right for you. Super rules can be complicated and they change over time, so make sure you consider your own situation before acting on any of what we've talked about. 

[00:29:52] For more information about today's episode, check out the show notes. 

KEYWORDS
superannuation, super at retirement, retirement planning Australia, account-based pension, lump sum super withdrawal, Age Pension eligibility, Age Pension asset test, income account, tax-free super withdrawals, women and super, Australian Retirement Trust, retirement income, comfortable retirement Australia, super and divorce, aged care costs, financial advice Australia