The Government has today extended the drawdown relief, in the form of a 50% reduction in minimum required pension payments, for account-based superannuation pensions in 2010-11. This helps retirees from having to sell assets at a low value. Minimum payments are determined by the age and the value of the account balance as at the 1 July each year.
Selling low (or buying high) has a significant impact on how long retirement monies will last. This risk can be managed by having an appropriate cash liquidity buffer by the time retirement is commence - and operating an appropriate draw and replenish rule for this buffer. There is futher information in our Technical Note at www.netactuary.com.au/_post/ManagingRetirementIncome.pdf
Thank you to all those people who have subscribed to the email update option on the web site. An update of new year support tools - Min Pension Calculators - Age Pension Entitlement Estimation under the new thresholds and the 2010-11 Transition to Retirement calculator will be forwarded in the next day or two.