Drawdown rates likely to change

The Covid-19 global pandemic was declared by the World Health Organization in March 2020. In response to this announcement, and to help Australian retirees, the government temporarily reduced the minimum annual payment for account-based pensions, annuities and similar products by 50% for the 2019/20 and 2020/21 financial year. 

Minimum drawdown rates from 1 July 2021

As we fast approach the end of the 2020/21 financial year, we expect the standard minimum drawdown rates to be automatically reinstated from 1 July 2021. This means they will return to the pre-Covid rates as outlined below:

Age

Temporary rates for 2019/20 & 2020/21 financial years

Standard rates from 1 July 2021 (FY 2021/22) onwards

Under 65

2%

4%

65 to 74

2.5%

5%

75 to 79

3%

6%

80 to 84

3.5%

7%

85 to 89

4.5%

9%

90 to 94

5.5%

11%

95 and over

7%

14%



For more information about the minimum drawdown rates, please visit the ATO’s minimum annual payments for super income streams webpage.

What does this mean for me?

As the minimum drawdown rates will be automatically reinstated from 1 July 2021, there’s no action required, unless you would like to change your pension payment amount. To do this you can either:

  1. Log into your online account and change your pension payment amount in the ‘Pension Payment’ section. Please note you cannot elect an amount below the minimum payment, or
  2. Complete and return the Change Your Pension Payment form, or call us on 1300 369 901 to request a copy of the form.

Reconsidering your drawdown strategy?

These changes may prompt you to reconsider your pension drawdown strategy, but before you make any changes it may be beneficial to speak to one of our financial planners. To make an appointment please call 1300 369 901 (and select option 2) or visit eisuper.com.au/appointment.