Turning 60 is one of the most significant milestones in your superannuation journey. It is the point where the rules around accessing your super change substantially, and the decisions you make from here can shape the quality of your retirement for the next 25 to 30 years.
If you were born after 30 June 1964, your preservation age is 60 — meaning this is the earliest you can access your super (outside of limited hardship provisions). Even if you were born earlier and have a slightly lower preservation age, turning 60 still triggers important tax and access changes.
Here is what you need to know.
You Can Access Your Super Tax-Free
Once you turn 60, any withdrawals from a taxed super fund are completely tax-free. This applies to both lump sum withdrawals and pension payments. There is no limit on the amount you can withdraw (subject to your account balance), and you do not need to include these amounts in your tax return.
That’s a big change from before preservation age, where withdrawals may include a taxable component. After 60, it’s straightforward — tax-free.
One exception: if you’ve got an untaxed element in your super (common in some public sector or defined benefit funds), that component may still be taxable on withdrawal. Most people with standard employer super funds will not have an untaxed element.
You Do Not Have to Retire to Access Super
A lot of people think you have to retire before you can touch your super. That’s not quite right. At 60, you’ve got two main options:
1. Retire and access fully: If you leave employment after turning 60, you meet a “condition of release” and can access your entire super balance — lump sum, pension, or a mix. You don’t have to stop working permanently. If you leave one job at 60, you can access your super and then start a new job without any impact on your entitlement.
2. Keep working and use a Transition to Retirement (TTR) strategy: If you are still working and do not want to retire yet, you can start a Transition to Retirement pension. This allows you to draw an income stream from your super (between 4% and 10% of your balance per year) while continuing to work and receive a salary.
A TTR strategy can be used to supplement your income, reduce your working hours, or implement a salary sacrifice arrangement where you redirect pre-tax salary into super while drawing a tax-free pension to replace the lost take-home pay. The net effect can be a tax saving that boosts your overall super balance.
Key Decisions to Make at 60
Turning 60 is not just a milestone — it is a decision point. Here are the questions worth addressing:
Should I consolidate my super?
If you have multiple super accounts, now is a good time to consolidate. Multiple accounts mean multiple sets of fees and insurance premiums eroding your balance. Before consolidating, check whether any existing account has insurance cover worth retaining — particularly if your health has changed since the policy was issued.
Is my investment mix still right?
The investment mix that worked during your accumulation years might not suit the drawdown phase. You may want to reduce exposure to high-growth, volatile assets and increase your allocation to defensive investments that provide more stable returns. But don’t be too conservative — your super may need to last 25 to 30 years, and you still need growth to outpace inflation.
Should I start a pension or take a lump sum?
Starting an account-based pension provides a regular income stream and keeps your money in the super environment where investment earnings may be tax-free (up to the transfer balance cap of .9 million). Taking a lump sum gives you immediate access but moves the money outside super, where investment earnings become taxable.
For most people, a combination works best — start a pension for regular income and retain some in accumulation if your balance exceeds the transfer balance cap.
What about insurance inside super?
Many people hold life insurance, TPD, and income protection insurance through their super fund. As you approach retirement, review whether these policies are still needed. Life insurance premiums increase with age and can erode your balance significantly in your 60s. If your debts are paid off and your dependants are financially independent, you may no longer need the same level of cover.
The Transfer Balance Cap
When you start a retirement phase pension, the amount you transfer is counted against your transfer balance cap — currently .9 million (2025/26). This cap limits how much super you can move into the tax-free pension phase. Any excess must remain in accumulation phase, where investment earnings are taxed at 15%.
If your super balance is approaching or exceeding .9 million, the sequencing and timing of your pension commencement matters. Getting this right can save you significant tax over the life of your retirement.
Do Not Rush — But Do Not Wait Too Long
Turning 60 opens doors, but you don’t have to walk through all of them straight away. There’s no deadline to access your super, and in many cases it makes sense to leave it invested and growing if you are still working and do not need the income.
That said, there are time-sensitive strategies, particularly around contribution caps, the carry-forward rule, and TTR arrangements — that become less effective the longer you wait. If you’re turning 60 in the next year or two, now’s the time to take a look.
What Should You Do Next?
The decisions you make around your super at 60 are among the most consequential of your financial life. The difference between a well-structured retirement and a missed opportunity can be tens of thousands of dollars over the course of your retirement.
At Great Advice, we help people in the Logan corridor navigate this exact transition every day. If you are approaching 60 and want to understand your options, book a free initial consultation and we will help you build a clear plan.
Call 07 3290 0393 or visit greatadvice.com.au to book your free consultation.
References
- Australian Taxation Office (ATO), Preservation Age and Conditions of Release.
- Australian Taxation Office (ATO), Tax on Super Benefits: Lump Sum and Income Stream.
- Australian Taxation Office (ATO), Transition to Retirement Income Streams.
- Australian Taxation Office (ATO), Transfer Balance Cap.
- Australian Taxation Office (ATO), Key Superannuation Rates and Thresholds: Contributions Caps.
- MoneySmart (ASIC), Super Withdrawal Options.
- MoneySmart (ASIC), Account-Based Pensions.
General Advice Warning: This article contains general information only and does not take into account your individual objectives, financial situation, or needs. Superannuation rules are complex and the strategies discussed may not be suitable for everyone. Before making any financial decisions, you should seek personal financial advice from a licensed adviser. Great Advice Financial Advisers is a Corporate Authorised Representative of Akumin Financial Planning Pty Ltd (AFSL 232706).
