You can invest in the same assets, such as cash, shares or property, inside or outside a pension. The difference is that the government provides tax savings on investments inside a pension as an incentive to convert your super into a regular income stream to support you in retirement, rather than taking it as a lump sum. Because investment earnings in a pension are not taxed, the same investment in a pension will go further than if invested outside a pension.

KEEPING CONTROL OVER YOUR MONEY

When moving your money to a pension account, you must draw down on it, with the government imposing a minimum drawdown amount, depending on your age.

With a Team Super pension account you can choose the amount you want to receive each year (subject to the minimum age-based amount set by the government). Your payments will be paid into your bank account and you can choose how often you want to be paid; fortnightly, monthly, quarterly, half-yearly or yearly. And best of all, you also have the flexibility to take out lump sum amounts when needed, for example if you want to buy a new car, renovate or go on a holiday.

Handy tip: With share market volatility a normal part of investing, it’s important to understand how your investment strategy can help manage the impact of market downturns. Read Safeguarding your pension during a market dip to learn how structuring your investments in a pension account can help reduce the need to draw down on growth assets after a market drop.