5 reasons to open an NGS Income account

There is plenty to think about when it comes to retirement. You may be considering your current financial position, how you will spend your time and how much money you will need to do all the things you want to do. These are common questions and important ones to consider. At NGS, we believe that retirement should be stress-free and a time of life that you can enjoy without financial worry. One way you can set yourself up for a successful retirement is by opening an NGS Income account. An NGS Income account pays you a regular income during your retirement, making it an easier transition from work to retirement.

In addition to making your transition to retirement a smooth one, there are other benefits. Our Education Manager, James Perry, shares his top 5 reasons why it may benefit you to open an NGS Income account.

1. Flexible tax-free income in retirement

Opening an Income account lets you receive regular payments from your super in retirement, just like a salary. After the age of 60, this income is tax-free, so there's no tax to pay on it. You can adjust your income payments and payment frequency at any time provided you meet the minimum annual payment amounts.

2. No tax on investment earnings

Not only is the income you withdraw from an Income account tax-free, but the balance invested also incurs no tax on any investment earnings. In contrast, investment earnings in a standard superannuation (accumulation) account are taxed up to 15%. With an Income account, you keep more of your investment earnings.

3. Retirement Bonus

If you're an NGS Accumulation account holder and you transfer your balance to an NGS Income account, you may be eligible for a Retirement Bonus, which is essentially a tax credit. NGS can withhold tax from Accumulation account holders for future tax liabilities meaning that when you move your super to the tax-free Income account, capital gains tax is no longer payable by the Fund on the transferred amount. So any withheld tax is effectively returned to you by way of a bonus payment.

The amount paid under the Retirement Bonus is an estimate of withheld tax based on the tax status, the Retirement Bonus rate for each investment option and your average balance in each option over the past 3 years. In some cases, it could be zero, but in others it could be significant.

For example, as at 6 November 2024 the Retirement Bonus rate that would apply to the Diversified (MySuper) option was 1.43665%. If you transferred a balance of $500,000 from an NGS Accumulation account to an Income account at this time, and if the average balance of your investment over the prior 3 years was at least $500,000, you would have received an estimated Retirement Bonus of $7,183.

4. Investing for the long term

When you retire, you might be tempted to withdraw your super and put it in a bank account because it's easily accessible and familiar. However, if you plan to use this money to supplement your income for the next 20 years, keeping it in a low-interest cash savings account may not ensure its longevity. By investing instead in a tax-effective account, you can potentially achieve more growth over time, helping your savings last longer.

5. Easy access to your super

Even in retirement you can have unexpected expenses. With an NGS Income account, you can withdraw extra funds at any time simply by logging into Member Online and requesting a withdrawal. There is no limit to how much you can withdraw from an Income account, so your money isn’t “locked away”.

Who is eligible for an NGS income account?

If you are 65 or older, you can open an NGS Income account at any time. For those between the ages of 60 and 64, you must either be retired or have ended an employment arrangement after turning 60 to qualify. Typically, you are not eligible to open an Income account if you are under 60.

Let us help you

Are you interested in opening an NGS Income account? Open your account here.

It's a good idea to speak to a financial planner to help you plan for retirement and what steps you may need to take to get there. A financial planner can:

• Discuss your goals for the short and long-term and help you reach those goals
• Help you understand the likelihood of being able to meet your goals and how long your financial assets may last through retirement
• Provide strategies and recommendations to assist you in maximising your entitlements

Talk to a Financial Planner.

You can also speak with one of our Super Specialists. It's free, and they can answer your general questions about superannuation, investments, insurance, or transitioning to retirement.

Seeking advice is a way to plan for your future, to mitigate risks and make the most of your saving opportunities. Education is integral to the planning process — it's important that you feel confident and informed at all times. Book your free chat with an NGS Super Specialist.