• When can I access my super?
• At what age can I qualify for the age pension?
• How can I generate an income in retirement?
• What is a binding death nomination?
• What are the cut off times for transactions?
• How do I open an account with Colonial First State?
• Once I have an account how do I make additional investments?
• I’m ready to invest with Colonial First State. How do I go about it?

Getting started

Q.    When can I access my super?
A.    Generally you must reach your preservation age and permanently retire before you can access your super as a lump sum or pension. Accessibility depends on your age - those born before 1 July 1960 can access their super when they are 55, whereas if you were born after 30 June 1964, you have to be 60.

 

You may sometimes be allowed to access your super before your preservation age under special circumstances such as permanent incapacity or severe financial hardship. Also, you may be able to set up a pre-retirement pension, if you’re over 55 and under 65. A pre-retirement pension allows you to convert your super into a regular income stream, but doesn’t allow you to take lump sum withdrawals until you’re fully retired. These are options you should discuss with your financial adviser.

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Q    At what age can I qualify for the age pension?
A.   If you are expecting to get the age pension in your retirement, you need to factor in the age at which you are able to apply. This depends on whether you’re male or female. All men regardless of when they were born, and women born after 1 January 1949, are entitled to apply for the age pension once they reach age 65. Women born before 1 July 1935 are eligible for the age pension at age 60. Women born between 1 July 1935 and 31 December 1948 are eligible to apply for the age pension once they reach the age shown in the table below.

Taking these two factors into consideration, there could well be gaps between the time you choose to retire, the time you are able to access your super, and the time you can apply for the age pension.

As at 20 March 2009, the maximum pension was around $14,970 pa (not including the pharmaceutical allowance) for a single person, or $24,903 (not including the pharmaceutical allowance) for a couple*. 

There are two separate tests used to determine the level of pension payments you might receive – an income test and an assets test. The table below shows the current thresholds that apply to a couple. If you and your spouse's income or assets exceed the full pension threshold (column B), your payments will proportionately decrease from the maximum until they phase out completely once you reach the 'cut out' threshold (column C).

It is important to remember that your entitlement to a pension is subject to both an income test and an assets test, and the test which results in the lowest rate of payment is used.

 

*As at 1 July 2009, Source: Centrelink
Different thresholds apply for individuals. Refer to Centrelink’s website, centrelink.gov.au, or speak with your financial adviser.

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Q.    How can I generate an income in retirement?
A.    If you are intending to convert your super to an income stream with FirstChoice, you can commence an ordinary allocated pension or a pre-retirement allocated pension.

An allocated pension provides a regular income with a reasonable amount of flexibility. You must take at least a minimum income payment each year based on your age, as per the table below. There is no maximum payment (unless you have a pre-retirement allocated pension). You can vary your payments to suit your lifestyle, plus you can make lump sum withdrawals at any time.

If you have reached your preservation age but don't have sufficient money to permanently retire or you want to keep working, a pre-retirement allocated pension is an option. It allows you to convert your super into a regular income stream, but doesn't allow you to take lump sum withdrawals until you're fully retired or turn 65. You can also continue to contribute back into your super to maintain or even grow your super balance for when you retire permanently. With a pre-retirement allocated pension, you must take a minimum yearly income payment as per the table below, up to a maximum of 10% of your pension account balance.

Yearly pension minimums

This table shows you the minimum amount of income per year you must receive from your overall pension account balance, based on your age.

There are some  transition to retirement strategies you may want to consider before you completely stop working.

While transition to retirement initially referred to the reaching preservation age condition of release, the term is more closely associated with the strategies that have developed from the ability to access super while still working.

The two most common transition to retirement strategies are:

• reduce working hours and top up cash flow with income from a pre-retirement

pension, or

• continue working, salary sacrifice employment income, and top up cash flow from a pre‑retirement pension.

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Q.   What is a binding death nomination?
A.   You can complete a binding death nomination to require that we pay your death benefit to the dependants you nominate or to your legal personal representative. If you complete and we receive your valid binding death nomination prior to your death, we are required to follow your nomination. This can provide you with greater certainty on who will receive your super benefit when you die.

Who can you nominate?

You can only nominate your legal personal representative or your dependants for your Binding death nomination to be valid. Your legal personal representative is the person appointed on your death as the executor or administrator of your estate. Your dependants are:

• your current spouse or de facto
• your child (including step, adopted, ex-nuptial or current spouse’s child and your child in the Family Law Act meaning).
• Anyone financially dependent on you
• any person with whom you have an interdependency relationship (as defined at your death)

Note: Depending on who you choose as a beneficiary, tax may be payable on the benefit. For more information speak to your financial adviser.

How your death benefit will paid?

If you have nominated one of more of your dependants, they will be provided the choice of taking their proportion of the death benefit as a lump sum cash payment or a pension from a pension investment account. Please note, however, that from 1 July 2007 if you have nominated a child, the death benefit must be paid to them as a lump sum cash payment unless the child:

• is under age 18
• is under age 25 and is financially dependent on you, or
• has a certain type of disability.

If your child’s personal circumstances change so that they no longer meet one of these exceptions, we will pay the remaining account balance to them as a lump sum cash payment.

How can you ensure your nomination is valid?

For your nomination to be valid it must:

• Be made in writing to the superannuation fund

Set out the full name and date of birth of your nominated beneficiaries. Alternatively, if you wish to nominate your estate state ‘my legal personal representative’

• Clearly set out the proportion of benefit to be paid to each person nominated and how the benefit is to be paid (lump sum and/or income stream)
• Be signed by you in the presence of two witnesses over the age of 18 (they cannot be beneficiaries on the form)
• Contain a signed witness declaration for each witness
• Be received and processed by your super fund

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Q.   What are the cut-off times for transactions?
A.    If your valid transaction request is received in our office before 3pm Sydney time, it will be processed that day using the next determined unit price.

If your valid transaction request is received after 3pm your transaction will be processed the following NSW business day.

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Q.   How do I open an account with Colonial First State?
A.   Making the right investment decision isn’t always straight forward. We recommend you discuss your options with a financial adviser.

1. Request a Product Disclosure Statement. Decide which type of product you want to invest in (investments, superannuation or pension). Then get hold of a copy of the relevant product brochure, known as a Product Disclosure Statement (PDS). This is available from your financial adviser, through our website or by calling us direct.
   
   Download a PDS 
   Request a PDS be mailed to you
   Order a PDS by phone on 1300 360 645
   
   
2. Read the Product Disclosure Statement. The PDS contains information relevant to your investment decisions (asset classes, risk and return, diversification), details on the product itself (transacting, unit pricing, terms and conditions), information on the investment options available and an application form. You should read all the information in the PDS and decide which investment options you want to invest in.
   
   If you have any questions or would like help completing the application form, please call us on 1300 360 645.
   
   
3. Make an application. Either complete the application form at the back of the PDS or, alternatively, you can apply online.
   
   Applying by mail: don’t forget to include a cheque or complete the direct debit form.
   
   Applying online: you’ll need to print a copy of the final application, sign it and send it to us with your payment.
   
   
4. Wait for confirmation. Your application will be processed within two days, once we receive your correctly completed application and payment details. You should receive your confirmation pack five business days later, together with the information you need for accessing your personal account information online.

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Q.   Once I have an account how do I make additional investments?
A.   By Direct Debit, direct credit, by cheque, by BPay. For further information download the flyer How to add to your investments.

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Q         I’m ready to invest with Colonial First State. How do I go about it?
A.

1. Decide which type of product type you want to invest in (investments, superannuation or pension). Then get hold of a copy of the relevant product brochure, known as a Product Disclosure Statement (PDS). This is available from your financial adviser, through the link below or by calling us direct.
   
   Download a PDS 
   Request a PDS be mailed to you
   Order a PDS by phone on 1300 360 645
   
   
2. Read the PDS, it contains information relevant to your investment decisions (asset classes, risk and return, diversification), details on the product itself (transacting, unit pricing, terms and conditions), information on the investment funds available and an application form. You should read all the information in the PDS and decide which investment options you want to invest in.
   
   

If you have any questions or would like help completing the application form, please call us on 1300 360 645.

3. Complete the application form. Either complete the application form at the back of the Product Disclosure Statement or apply online.
   
   Applying by mail: don’t forget to include a cheque or complete the direct debit form.
   
   Applying online: you’ll need to print a copy of the final application, sign it and send it to us with your payment.

4. Wait for confirmation. Your application will be processed within two days, once we receive your correctly completed application and payment. You should receive your confirmation pack five business days later, together with the information you need for accessing your personal account information online.

Making appropriate investment decisions isn’t always straightforward. We recommend you discuss your options with a financial adviser.

The information contained in this document is based on the understanding Colonial First State Investments Limited ABN 98 002 348 352 AFS Licence 232468 has of the relevant Australian laws as at 1 July 2009. This document is not advice and is intended to provide general information only. It does not take into account your individual needs, objectives or personal circumstances. You should assess whether the information is appropriate for you and consider talking to a financial adviser before making an investment decision. Product Disclosure Statements (PDS) for products offered by Colonial First State are available from colonialfirststate.com.au or by contacting us on 13 13 36. You should read the relevant PDS and consider whether the product is right for you. Past performance and awards are no indication of future performance.