For many Australians approaching or entering retirement, one of the biggest decisions is what to do with their super. It can be tempting to withdraw your balance and move it into other investments, like a term deposit, a standard bank account or even an investment property.
But in many cases, keeping your money inside super (specifically, transitioning your balance into an account-based pension) may deliver real financial advantages, depending on your circumstances. Your money remains invested so it continues working for you, and you gain access to tax, investment, liquidity and service benefits that may be hard to replicate outside the super system.
Here’s an overview of the top five reasons to consider keeping your money in super when you retire.
1. Tax advantages and the retirement bonus
One of the biggest advantages of keeping your money in super during retirement is tax.
Zero tax on earnings
Once you move into an account-based pension, earnings on your investments are generally tax free, subject to eligibility and tax law (including any applicable caps).
If you invest outside super, however, there’s generally tax payable on:
• Bank interest
• Rental income
• Capital gains
Zero tax on withdrawals
If you’re 60 or older, payments from super are generally tax free (subject to preservation rules).
This combination of no tax on earnings and no tax on withdrawals, is a significant advantage of super compared with many other investment structures.
Vision Super also offers a retirement bonus to eligible members. Start an eligible Vision Super Income Stream and you could receive a bonus of up to 0.5 percent of your balance on retirement. That’s a healthy boost to your retirement savings. You can find out more about the Retirement bonus here.
2. Exposure to long-term investment growth
Retirement doesn’t have to mean your investments stop growing. In fact, many Australians will spend 20–30 years in retirement, meaning your savings need to continue generating returns over the long term.
While past performance cannot be relied on as an accurate indicator of future performance, super funds have historically delivered positive long‑term returns. Super Guide reports that over the past 33 years, the median Growth fund has returned 8% per year on average and the annual CPI increase is 2.7% giving a real return of 5.3%.*
By staying invested in super:
• Your balance can remain in professionally managed investment options.
• Your money can benefit from compounding returns over time, which can have a material impact on your retirement balance.
*Source: Super fund performance: Annual returns to December 2025 superguide.com.au
3. Flexible, easy access to your money
A common misconception is that super becomes ‘locked away’ in retirement. In fact, with an account-based pension, you can:
• Receive regular, flexible income payments
• Make lump sum withdrawals at any time (subject to super rules and processing timeframes)
• Adjust the amount or frequency of payments as your circumstances change, and
• Request online benefit payments.
By comparison:
• Term deposits typically restrict access until the maturity date.
• Property can be illiquid, so you may need to sell an entire asset to access cash.
• Bank accounts offer access, but returns may be lower than other investment options, depending on interest rates.
Super pension accounts strike a balance between ready access to funds plus investment potential.
4. Expert strategies to manage investment risk
Super funds are built to help members navigate investment risk at all stages of life, including retirement. Unlike going it alone, when you stay with a super fund you benefit from the investment expertise and strategies of the fund.
Growth/defensive asset mix
Most super pension options use a diversified blend of:
• Growth assets (e.g. shares, property) for long-term returns
• Defensive assets (e.g. bonds, cash) to help smooth out volatility
Professional management
Your fund’s investment team aims to actively manage investment risks, which is something that would be difficult and costly to replicate as an individual investor.
Automatic diversification
Your super balance is usually invested across many asset classes, industries and regions, so if one is performing poorly, another might be performing better which can offset the negative impact on your overall balance. Compare this to putting a large portion of your wealth into:
• A single property
• A single bank
• A single asset class
Super diversification aims to reduce the impact of market ups and downs on your retirement income.
5. Access to service, support and advice
At Vision Super, we pride ourselves on the service and support we offer members, including:
• Financial education and seminars
• Retirement planning tools
• Phone-based or face-to-face super advice
• Guidance on investment options and pension strategies
Property, bank accounts or DIY investing rarely come with this level of built-in support. For many Vision Super members, having a team on hand to help you feel confident about your income and investment decisions is just as valuable as the financial benefits.
So, what’s the right call?
While you may be considering moving your money out of super, such a choice may cost you in growth, tax savings and access to funds. Keeping your savings in super could ensure your money remains working hard throughout your retirement.
Before you make any decisions, we recommend you speak with a financial adviser who will consider your individual circumstances, goals and timeframe for investing.
Past performance is not a reliable indicator of future performance.
Any advice in this article is general only and has been issued by Vision Super Pty Ltd (ABN 50 082 924 561) (AFSL 225054) as the Trustee of the Local Authorities Superannuation Fund (ABN: 24 496 637 884) (‘Vision Super’). The advice does not take into account your personal objectives, financial situations or needs. Before acting on the advice, you should consider whether it is appropriate for you, having regard to your own circumstances, and obtain the appropriate Product Disclosure Statements (PDS)/ Member Guides and Target Market Determination (TMD).