If you were lucky enough to be employed through local government or water authorities before 1994 you may have a Vision Super Defined Benefit (DB) account. A DB account is very different to the accumulation accounts we see today in that your retirement balance is formulated based on an equation, rather than investment returns.
Once you leave employment however, and you are not re-employed by a DB registered employer within two months of your departure, you will be required to make some important decisions about your benefit. Do you want to defer your account, set up a lifetime pension, or move it into an account-based pension? While we know all of this sounds daunting, don’t forget Vision Super’s financial advisors are on hand to help break it all down.
What happens when I leave employment?
Your employer will advise Vision Super of your departure, including:
- confirming your salary and years of membership
- advising the type of employment termination, for example, retirement, retrenchment, disability, resignation.
This might occur either prior to or after your actual departure date. When all the correct information is received by Vision Super, we will calculate your benefit entitlements, and write to you explaining the next steps.
When you resign, you have several options to choose from, such as taking a resignation benefit (cash payment), putting your funds into a Deferred Retirement Benefit, starting a Lifetime Pension (if eligible), or opening an accumulation or Income Stream account. You can even choose more than one of these options, which means it’s important to get the right advice.
Choosing a Vision Super Deferred Retirement Benefit
When you chose to defer your lump sum, a Deferred Retirement Benefit account is established in your name and your retirement benefit is credited to this account. Unfortunately, this account cannot be added to, either by way of cash contributions or rollovers from other funds but is invested which means your benefits fluctuate with the market.
Your Deferred Retirement Benefit must remain in the Fund and can only be paid in the following circumstances:
- after reaching your applicable preservation age (between 55-60 depending on your date of birth)
- on total and permanent disablement as determined by the Trustee, or
- on death.
After age 55
Subject to preservation age requirements, a Deferred Retirement Benefit can be transferred to another Vision Super Product and can be payable to you if a condition of release is met.
Lifetime Pension option
If you joined the Defined Benefit Plan prior to 25 May 1988, you can elect to convert up to 50% of your benefit into a Lifetime Pension from age 55.
If you are eligible, the Lifetime Pension pays a regular fortnightly income stream throughout your life, and, in the event of your death, at a reduced rate throughout the life of a qualifying spouse. It is also fully indexed with the CPI.
After age 65
After you reach age 65 or 40 years of service, you will be required to make decisions on your benefit.
Need to talk one-on-one?
Our Financial Planners are super and DB specialists and understand the intricacies of a DB product and what they offer. Their job is to help members plan their retirement and do not receive brokerage, fees, bonuses or commissions for recommending products. If you choose to obtain advice from a Vision Super Financial Planner, you may be charged a fee on a user pays basis. Call the Member Services team on 1300 300 820 Monday to Friday 8:30am to 5pm to set up a time.