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Since 1 July 2017 there has been a $1.6 million limit on the amount you can transfer into a super account in pension phase. The question is, is this an arbitrary figure dreamed up by bureaucrats or is it enough for a dream retirement?
The $1.6 million balance transfer cap applies to individuals, which means a couple could have up to $3.2 million in individual accounts. However, if a couple has one account between them in a single name, the $1.6 million limit applies.
Using MoneySmart’s Retirement Planner we have calculated how much income $1.6 million in super will generate under a range of scenarios including:
- Whether you are single or in a couple.
- The age you plan to retire. We have selected 60, which is a common goal, then 65, 66, 67, 68, 70 and 75 to show the impact of delaying retirement.
- How long you want your money to last. We run the numbers for age 85, 90, 95 and 100 on the basis that the average retiree will live until their mid-80s and some will celebrate 100.
- The return on your $1.6 million, net of fees. The return your super investments earn in retirement will depend on the type of investments you choose. A higher ratio of growth to defensive investments will result in a higher long-term return. To demonstrate the difference a few percentage points can make, we break down the annual income received for an average net return of 2%, 3%, 4%, 5%, 6%, 7% and 8%.
We also assume you are a homeowner and include income from a full or part Age Pension if you are eligible (this may happen as your super balance reduces over time). However, we don’t take into account income from assets you may hold outside super.
All figures are in today’s dollars (adjusted for inflation). We have assumed an annual 2.5% rise in cost of living and an additional 1.5% rise in living standards per year.
Where to go for more
We hope that the figures in the tables below will get you thinking.
Income generated from a $1.6 million retirement super balance
First let’s look at various scenarios for a couple with a combined balance of $1 million on retirement, which they transfer into a super pension account.
Couple: Retiring at 60
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $67,837 | $72,236 | $77,155 | $82,729 | $88,884 | $95,759 | $103,324 |
| 85 | No | $47,292 | $53,513 | $60,712 | $68,566 | $77,004 | $85,887 | $95,362 |
| 90 | Yes | $59,833 | $63,578 | $68,057 | $73,184 | $78,987 | $85,752 | $93,451 |
| 90 | No | $38,652 | $44,237 | $50,898 | $58,722 | $67,399 | $76,614 | $86,416 |
| 95 | Yes | $54,610 | $57,824 | $61,693 | $66,343 | $71,921 | $78,557 | $86,355 |
| 95 | No | $32,818 | $37,752 | $43,817 | $51,278 | $60,286 | $70,007 | $80,155 |
| 100 | Yes | $51,080 | $53,645 | $57,037 | $61,316 | $66,505 | $73,050 | $81,024 |
| 100 | No | $28,647 | $33,014 | $38,473 | $45,319 | $54,009 | $64,847 | $75,689 |
Couple: Retiring at 65
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $80,459 | $85,519 | $90,925 | $96,938 | $103,314 | $110,275 | $117,827 |
| 85 | No | $61,272 | $67,939 | $75,210 | $83,038 | $91,274 | $99,921 | $108,956 |
| 90 | Yes | $68,133 | $72,331 | $77,236 | $82,729 | $88,884 | $95,759 | $103,324 |
| 90 | No | $47,875 | $53,841 | $60,727 | $68,494 | $76,993 | $85,887 | $95,362 |
| 95 | Yes | $60,575 | $64,185 | $68,280 | $73,185 | $78,987 | $85,752 | $93,451 |
| 95 | No | $39,426 | $44,654 | $50,916 | $58,387 | $67,072 | $76,582 | $86,416 |
| 100 | Yes | $55,493 | $58,463 | $62,128 | $66,611 | $71,938 | $78,557 | $86,355 |
| 100 | No | $33,687 | $38,251 | $43,828 | $50,681 | $59,095 | $69,401 | $80,188 |
Couple: Retiring at 66
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $83,839 | $88,962 | $94,521 | $100,566 | $107,047 | $114,065 | $121,547 |
| 85 | No | $64,835 | $71,655 | $78,998 | $86,764 | $94,993 | $103,553 | $112,543 |
| 90 | Yes | $70,127 | $74,490 | $79,457 | $85,093 | $91,264 | $98,155 | $105,733 |
| 90 | No | $50,095 | $56,188 | $63,162 | $70,960 | $79,372 | $88,267 | $97,614 |
| 95 | Yes | $61,871 | $65,532 | $69,823 | $74,827 | $80,750 | $87,475 | $95,164 |
| 95 | No | $40,931 | $46,263 | $52,617 | $60,144 | $68,817 | $78,219 | $87,945 |
| 100 | Yes | $56,372 | $59,410 | $63,233 | $67,756 | $73,185 | $79,864 | $87,630 |
| 100 | No | $34,795 | $39,451 | $45,099 | $51,984 | $60,408 | $70,655 | $81,258 |
Couple: Retiring at 67
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $87,643 | $92,862 | $98,562 | $104,636 | $111,183 | $118,230 | $125,696 |
| 85 | No | $68,909 | $75,773 | $83,162 | $90,951 | $99,115 | $107,647 | $116,521 |
| 90 | Yes | $72,323 | $76,849 | $81,949 | $87,639 | $93,979 | $100,852 | $108,384 |
| 90 | No | $52,517 | $58,742 | $65,757 | $73,599 | $81,972 | $90,773 | $100,076 |
| 95 | Yes | $63,215 | $67,036 | $71,447 | $76,618 | $82,574 | $89,354 | $97,002 |
| 95 | No | $42,559 | $48,000 | $54,436 | $62,018 | $70,634 | $79,946 | $89,454 |
| 100 | Yes | $57,271 | $60,462 | $64,377 | $68,945 | $74,485 | $81,211 | $88,884 |
| 100 | No | $35,984 | $40,710 | $46,429 | $53,353 | $61,792 | $71,979 | $82,443 |
Couple: Retiring at 68
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $91,852 | $97,278 | $103,018 | $109,179 | $115,838 | $122,845 | $130,257 |
| 85 | No | $73,408 | $80,374 | $87,766 | $95,565 | $103,678 | $112,166 | $120,952 |
| 90 | Yes | $74,712 | $79,433 | $84,656 | $90,470 | $96,777 | $103,667 | $111,183 |
| 90 | No | $55,176 | $61,528 | $68,665 | $76,496 | $84,759 | $93,561 | $102,754 |
| 95 | Yes | $64,740 | $68,620 | $73,167 | $78,455 | $84,544 | $91,358 | $98,930 |
| 95 | No | $44,310 | $49,864 | $56,385 | $63,994 | $72,651 | $81,752 | $91,353 |
| 100 | Yes | $58,313 | $61,574 | $65,567 | $70,290 | $75,914 | $82,652 | $90,356 |
| 100 | No | $37,252 | $42,058 | $47,832 | $54,807 | $63,243 | $73,358 | $83,688 |
Couple: Retiring at 70
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $102,070 | $107,660 | $113,250 | $120,078 | $126,713 | $133,765 | $141,215 |
| 85 | No | $84,258 | $91,368 | $98,795 | $106,537 | $114,578 | $122,939 | $131,562 |
| 90 | Yes | $80,459 | $85,519 | $90,925 | $96,938 | $103,314 | $110,275 | $117,827 |
| 90 | No | $61,346 | $67,937 | $75,210 | $83,038 | $91,274 | $99,921 | $108,956 |
| 95 | Yes | $68,133 | $72,331 | $77,236 | $82,729 | $88,884 | $95,759 | $103,324 |
| 95 | No | $48,305 | $54,031 | $60,734 | $68,437 | $76,975 | $85,887 | $95,362 |
| 100 | Yes | $60,710 | $64,225 | $68,326 | $73,231 | $78,987 | $85,752 | $93,451 |
| 100 | No | $40,072 | $45,039 | $50,620 | $57,970 | $66,383 | $76,334 | $86,429 |
Couple: Retiring at 75
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $144,917 | $151,150 | $157,552 | $164,297 | $171,083 | $178,365 | $185,773 |
| 85 | No | $128,986 | $136,253 | $143,749 | $151,402 | $159,246 | $167,269 | $175,469 |
| 90 | Yes | $102,080 | $107,655 | $113,669 | $120,096 | $126,724 | $133,778 | $141,230 |
| 90 | No | $84,381 | $91,380 | $98,795 | $106,537 | $114,578 | $122,939 | $131,562 |
| 95 | Yes | $80,811 | $85,642 | $90,959 | $96,944 | $103,324 | $110,299 | $117,838 |
| 95 | No | $62,105 | $68,281 | $75,235 | $82,946 | $91,256 | $99,921 | $108,956 |
| 100 | Yes | $69,353 | $73,186 | $77,683 | $82,870 | $88,889 | $95,753 | $103,333 |
| 100 | No | $49,426 | $54,680 | $60,766 | $67,821 | $76,021 | $85,432 | $95,328 |
The following scenarios are for a single person with a retirement super balance of $1.6 million which they transfer into a super pension account.
Single: Retiring at 60
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $56,196 | $61,195 | $67,061 | $73,651 | $80,974 | $89,019 | $97,704 |
| 85 | No | $47,207 | $53,449 | $60,605 | $68,462 | $76,856 | $85,765 | $95,176 |
| 90 | Yes | $48,430 | $52,497 | $57,216 | $63,817 | $71,165 | $79,357 | $88,383 |
| 90 | No | $38,573 | $44,139 | $50,802 | $58,622 | $67,284 | $76,459 | $86,253 |
| 95 | Yes | $43,524 | $46,909 | $51,248 | $56,895 | $64,081 | $72,461 | $81,815 |
| 95 | No | $32,754 | $37,684 | $43,730 | $51,173 | $60,182 | $69,885 | $80,028 |
| 100 | Yes | $40,046 | $43,008 | $46,775 | $51,758 | $58,528 | $67,214 | $76,977 |
| 100 | No | $28,593 | $32,957 | $38,403 | $45,251 | $53,919 | $64,742 | $75,539 |
Single: Retiring at 65
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $69,485 | $75,005 | $81,231 | $88,052 | $95,374 | $103,308 | $111,700 |
| 85 | No | $61,189 | $67,819 | $75,086 | $82,888 | $91,111 | $99,745 | $108,754 |
| 90 | Yes | $56,957 | $61,630 | $67,192 | $73,650 | $80,974 | $89,019 | $97,704 |
| 90 | No | $47,794 | $53,742 | $60,585 | $68,372 | $76,860 | $85,765 | $95,176 |
| 95 | Yes | $49,413 | $53,265 | $58,021 | $63,918 | $71,097 | $79,357 | $88,383 |
| 95 | No | $39,357 | $44,575 | $50,814 | $58,270 | $66,954 | $76,463 | $86,253 |
| 100 | Yes | $44,576 | $47,845 | $51,875 | $57,066 | $63,794 | $72,309 | $81,815 |
| 100 | No | $33,627 | $38,191 | $43,765 | $50,590 | $58,991 | $69,277 | $80,062 |
Single: Retiring at 66
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $72,885 | $78,630 | $84,970 | $91,834 | $99,158 | $107,050 | $115,358 |
| 85 | No | $64,775 | $71,529 | $78,854 | $86,588 | $94,828 | $103,396 | $112,344 |
| 90 | Yes | $58,980 | $63,822 | $69,512 | $76,038 | $83,406 | $91,410 | $100,049 |
| 90 | No | $50,006 | $56,090 | $63,050 | $70,833 | $79,251 | $88,109 | $97,445 |
| 95 | Yes | $50,699 | $54,715 | $59,579 | $65,584 | $72,829 | $81,049 | $89,974 |
| 95 | No | $40,841 | $46,172 | $52,520 | $60,039 | $68,701 | $78,076 | $87,778 |
| 100 | Yes | $45,529 | $48,877 | $53,026 | $58,298 | $65,102 | $73,589 | $82,957 |
| 100 | No | $34,735 | $39,382 | $45,015 | $51,892 | $60,304 | $70,530 | $81,142 |
Single: Retiring at 67
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $76,724 | $82,650 | $89,059 | $95,940 | $103,276 | $111,147 | $119,454 |
| 85 | No | $68,779 | $75,598 | $83,019 | $90,768 | $98,940 | $107,453 | $116,311 |
| 90 | Yes | $61,234 | $66,231 | $72,049 | $78,655 | $86,047 | $94,031 | $102,575 |
| 90 | No | $52,422 | $58,637 | $65,665 | $73,488 | $81,845 | $90,650 | $99,892 |
| 95 | Yes | $52,107 | $56,229 | $61,257 | $67,372 | $74,684 | $82,844 | $91,708 |
| 95 | No | $42,476 | $47,912 | $54,339 | $61,884 | $70,523 | $79,754 | $89,427 |
| 100 | Yes | $46,545 | $49,991 | $54,243 | $59,620 | $66,490 | $74,937 | $84,177 |
| 100 | No | $35,915 | $40,643 | $46,345 | $53,265 | $61,682 | $71,852 | $82,300 |
Single: Retiring at 68
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $81,112 | $87,152 | $93,612 | $100,530 | $107,892 | $115,746 | $123,949 |
| 85 | No | $73,280 | $80,250 | $87,641 | $95,375 | $103,512 | $111,957 | $120,751 |
| 90 | Yes | $63,672 | $68,879 | $74,789 | $81,553 | $88,876 | $96,833 | $105,350 |
| 90 | No | $55,078 | $61,418 | $68,547 | $76,358 | $84,651 | $93,406 | $102,576 |
| 95 | Yes | $53,686 | $57,922 | $63,086 | $69,310 | $76,619 | $84,734 | $93,559 |
| 95 | No | $44,244 | $49,765 | $56,285 | $63,887 | $72,479 | $81,650 | $91,190 |
| 100 | Yes | $47,661 | $51,192 | $55,564 | $61,009 | $67,914 | $76,310 | $85,487 |
| 100 | No | $37,178 | $41,988 | $47,755 | $54,713 | $63,122 | $73,231 | $83,525 |
Single: Retiring at 70
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $91,620 | $97,813 | $104,375 | $111,453 | $118,852 | $126,638 | $134,671 |
| 85 | No | $84,127 | $91,209 | $98,619 | $106,348 | $114,382 | $122,716 | $131,339 |
| 90 | Yes | $69,485 | $75,005 | $81,231 | $88,052 | $95,374 | $103,308 | $111,700 |
| 90 | No | $61,237 | $67,823 | $75,086 | $82,888 | $91,111 | $99,745 | $108,754 |
| 95 | Yes | $57,295 | $61,799 | $67,223 | $73,643 | $80,974 | $89,019 | $97,704 |
| 95 | No | $48,201 | $53,959 | $60,626 | $68,299 | $76,851 | $85,765 | $95,176 |
| 100 | Yes | $50,214 | $53,900 | $58,478 | $64,079 | $71,064 | $79,346 | $88,383 |
| 100 | No | $40,006 | $44,961 | $50,837 | $57,861 | $66,265 | $76,201 | $86,246 |
Single: Retiring at 75
| Money lasting until age | Eligible for Age Pension? | 2% | 3% | 4% | 5% | 6% | 7% | 8% |
|---|---|---|---|---|---|---|---|---|
| 85 | Yes | $135,251 | $141,872 | $148,845 | $155,945 | $163,351 | $170,998 | $178,819 |
| 85 | No | $128,811 | $136,051 | $143,459 | $151,133 | $158,958 | $166,973 | $175,159 |
| 90 | Yes | $91,645 | $97,813 | $104,375 | $111,453 | $118,852 | $126,638 | $134,671 |
| 90 | No | $84,225 | $91,206 | $98,619 | $106,348 | $114,382 | $122,716 | $131,339 |
| 95 | Yes | $70,270 | $75,433 | $81,386 | $88,073 | $95,374 | $103,308 | $111,700 |
| 95 | No | $61,994 | $68,168 | $75,104 | $82,798 | $91,087 | $99,745 | $108,754 |
| 100 | Yes | $58,915 | $63,104 | $68,032 | $73,877 | $80,786 | $88,903 | $97,702 |
| 100 | No | $49,334 | $54,582 | $60,658 | $67,709 | $75,886 | $85,281 | $95,169 |
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I have a question relating to your retirement table for $1.6M in super.
For a couple with $1.6M your table shows yes & no for pension eligibility? I do not understand how a couple with this amount in super is eligible for the pension? Can you please clarify your assumptions
Hi Ian – The assumption is that because their assets are being drawn down (ie spent) in retirement, this reduces their asset levels to such a point that they subsequently become eligible for the Age Pension. Learn more about how the Age Pension assets test works.
Best wishes
The SuperGuide team