Super at 60 — Your Options Explained

Turning 60 is one of the most significant milestones for your superannuation. At 60, withdrawals from a taxed super fund become completely tax-free, new options become available, and the horizon to retirement sharpens considerably for most Australians. This guide explains what changes at 60, what decisions you face, and how to think about your super in the decade before or at retirement.

Key Takeaways

• At 60 (if retired or changing jobs), all super withdrawals from a taxed fund are completely tax-free
• You can access super as a lump sum, an account-based pension income stream, or a combination
• The transfer balance cap ($2.0M in FY2025–26) limits how much you can move into tax-free pension phase
• In pension phase, investment earnings are taxed at 0% rather than 15% in accumulation
• If still working at 60, you can continue contributing under the concessional and non-concessional caps without restriction

What Changes at Age 60?

Tax-Free Withdrawals

From age 60, all withdrawals from a taxed super fund are tax-free — regardless of amount, and regardless of whether you are retired:

• Lump sum withdrawals: 0% tax
• Account-based pension income: 0% tax, not included in assessable income

This applies to both the tax-free and taxable components of your super balance. See Tax-Free Super After 60 for full details.

Preservation Age Met (for Most Australians)

For Australians born on or after 1 July 1964, the preservation age is 60. From age 60, you have met your preservation age — meaning you can access super once you also meet a condition of release (most commonly, retiring from employment).

The two requirements to access super in full:

1. Reach preservation age (60 for most people born after June 1964)
2. Meet a condition of release — most commonly retirement (ceasing gainful employment with no intention of returning)

If you turn 60 but are still working, you have generally met the preservation age requirement — but you need to also be retired (or meet another condition of release) to access your super in full.

Options Available at 60

Option 1 — Continue Working, Leave Super Alone

The most common approach for those who turn 60 and are still working. Your super continues to grow, your employer continues paying SG contributions (12% of your salary from 1 July 2025), and you benefit from continued compounding. You don’t need to do anything.

Consider: Whether your investment option is still appropriate. As you near retirement, many people gradually shift from high-growth to balanced or growth options — though the right option depends on your own circumstances, risk tolerance, and retirement timeline.

Option 2 — Transition to Retirement Pension (TTR)

If you have reached preservation age (60+) but are still working, you can access a Transition to Retirement Pension (TTRP) — drawing a pension from super of up to 10% of your account balance per year, while continuing to receive salary.

TTRP is commonly used to:

• Supplement income if reducing working hours (e.g. moving from full-time to part-time)
• Boost super via salary sacrifice while drawing the pension to maintain take-home pay

Key TTRP rules:

• Maximum withdrawal: 10% of account balance per year
• Minimum withdrawal: 4% (standard minimum drawdown rate for under 65)
• Earnings in TTRP are NOT tax-free — they remain at 15% tax until you fully retire. This is different from a full retirement pension, where earnings are 0%
• Pension payments: Tax-free at 60+

Since 2017, the tax advantage of TTRP has been reduced (earnings tax is now 15%, same as accumulation). The benefit is now mainly for those genuinely reducing hours, not for tax-minimisation purposes at full employment.

See Transition to Retirement Pension — Full Guide.

Option 3 — Retire and Start an Account-Based Pension

Once you retire (cease gainful employment with no intention to return), you meet the retirement condition of release and can:

• Access your super in any amount (lump sum, partial, or full)
• Start an account-based pension (ABP) — drawing a regular income from super

In an ABP:

• You must draw a minimum of 4–14% per year depending on age (see Minimum Drawdown Rates)
• Earnings inside the pension account are 0% tax (on amounts within the Transfer Balance Cap)
• Withdrawals are 0% tax (from a taxed fund, at 60+)
• The transfer balance cap of $2.0 million (FY2025–26) limits how much you can move into the pension phase

Option 4 — Take a Lump Sum Withdrawal

At 60+, with a condition of release met, you can withdraw any amount from your super as a lump sum — completely tax-free. Some retirees use lump sums to:

• Pay off a mortgage
• Fund major purchases (home renovations, travel)
• Move money outside super to an investment portfolio

However, money withdrawn from super loses the super tax concessions — earnings on that money in a personal investment account are taxed at your marginal rate rather than 0%.

What to Review at 60 — Checklist

1. Super balance and investment option

• Check your current balance across all funds
• Review whether your investment option is appropriate for your retirement timeline
• Consider whether a slightly more conservative option makes sense, or whether you want growth exposure for a further 10–20 year horizon

2. Insurance

• Life insurance needs typically reduce as children grow up and mortgages reduce
• Review whether you still need the default insurance in your super (premiums reduce your balance)
• Consider whether any income protection cover is still relevant if you are near retirement

3. Beneficiary nomination

• Review your binding death benefit nomination — ensure it is current and reflects your wishes
• If it is a lapsing nomination and more than 2 years old, it will expire within a year — renew now

4. Consolidation

• If you still have multiple super accounts from previous jobs, consolidate before retirement (check insurance implications first)
• Consolidation simplifies the drawdown process and avoids duplicate fees

5. Age Pension planning

• Age Pension age is 67 — if you retire at 60–65, there is a gap period where you are living off super before Age Pension access
• Plan how much super you need to sustain your lifestyle for 7+ years before the Age Pension supplements income
• See Super and the Age Pension for how super interacts with the assets test and income test

6. Transfer Balance Cap

• If your super balance is approaching $2.0M (the transfer balance cap), understand the rules on how much you can move into tax-free pension phase
• Excess amounts remain in accumulation and are taxed at 15% on earnings

How Much Super Should You Have at 60?

The ASFA Retirement Standard suggests the following approximate balances for those approaching retirement:

These figures assume you will partly rely on the Age Pension from 67. If you retire at 60 and are fully self-funded until 67, you need more to bridge the 7-year gap.

Frequently Asked Questions

I just turned 60 — can I access my super? You need to have both reached your preservation age (60 for most people) AND met a condition of release. If you are still employed full-time, you generally do not meet the “retirement” condition of release. You can access super via a Transition to Retirement Pension while still working, subject to the 10% drawdown limit.

I’m 60 and want to reduce to part-time — should I start a TTRP? A Transition to Retirement Pension can help supplement income while moving to part-time work — allowing you to reduce salary sacrifice contributions and draw from the pension to maintain take-home pay. The benefit has reduced since 2017 (earnings in TTRP are no longer tax-free), but there are still circumstances where a TTRP makes sense. This is a decision worth discussing with a financial adviser.

I retired at 60 — how do I start an account-based pension? Contact your super fund and advise them you have met the retirement condition of release. The fund will ask for a declaration or documentation of your retirement. You then direct the fund to convert your accumulation account to an account-based pension (or partial — you can keep some in accumulation and start a pension with the rest up to the transfer balance cap).

Will my super run out if I retire at 60? It depends on your balance, drawdown rate, investment returns, and whether you qualify for the Age Pension from 67. Use the Super Drawdown Calculator to estimate how long your balance will last at different drawdown rates.

For advice tailored to your retirement situation, speak with a licensed financial adviser. You can find one through MoneySmart. Related reading: Super by Age, Account-Based Pension Explained, Tax-Free Super After 60, How Much Super to Retire.