Can you add to a retirement pension?
“I’ve heard that once I start drawing my pension, I can’t add further funds to it. Is this true?”
It’s a common misconception that you can’t boost your income stream after you start receiving a pension. While pension accounts don’t directly accept additional contri- butions, there are strategies to “refresh” your pension.
For example, you might keep new contributions in your accumulation account and when you retire, you can do a ‘pension refresh’ allowing you to combine your super or excess funds you contribute to super in the future, with your existing pension balance.
However, these options are subject to specific rules and limits, so it’s important to consider factors such as your age, transfer balance cap, and overall retirement plan. Consulting a financial adviser can help determine the best approach to ensure your retirement income meets your needs.
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FAQs
Can I add more money to my pension once it’s started?
Not directly, but you can contribute to your accumulation account and later combine it with your existing pension through a pension refresh.
What is a pension refresh?
A pension refresh is when you combine your pension balance with new super contributions to create a new income stream.
Are there limits to adding funds to my pension?
Yes. You must stay within the government’s transfer balance cap and contribution limits, which vary depending on your age and circumstances.
Should I speak to a financial adviser before doing this?
Absolutely. Super and pension strategies are complex. A professional adviser can help you avoid costly mistakes and maximise your retirement income.
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