AMP has released an update to its current superannuation offerings aimed at increasing retirement income by offsetting some funds before retirement to make greater use of Centrelink asset test concessions when receiving age pension payments.
The financial services firm said its new AMP Super Lifetime addition would not alter how a member invested their super or charge additional fees and run in the background of their super account, creating a ‘concessional’ balance, while not affecting their actual balance.
The concessional balance would use the deeming rate as its growth rate instead of the actual return of the super fund, which would create a balance lower than the member’s super balance.
“At retirement, the member can choose to move some of their super into an AMP Lifetime Pension account,” the firm stated, noting that account would work alongside its Super Allocated Pension product.
“When Centrelink assesses the member’s eligibility for the age pension, it uses the lower concessional balance for the portion invested in the AMP Lifetime Pension, instead of the member’s actual super balance. This may help the member qualify for more age pension, boosting their income in retirement.
“With increased certainty and financial confidence, many retirees may in turn choose to draw a higher income from their AMP Allocated Pension, further boosting income and improving quality of life in their earlier active retirement years.”
It added the new functionality would create greater benefits for younger super members who would have a longer time frame to use it and the Super Lifetime addition was currently available to those under age 58 who had not met a full condition of release.
AMP superannuation and investments group executive Melinda Howes said the addition was an efficient way for superannuants to get more out of their savings without additional work or cost.
“This is a breakthrough innovation for the superannuation industry and, most importantly, our members – a simple, no-cost feature that can significantly increase retirement income and improve access to the age pension,” Howes said.
“It’s designed to quietly work in the background, using government rules to unlock more income when it matters most.
“With AMP Super Lifetime, we’re giving our members the opportunity to make their super work harder without lifting a finger – no changes to how their money is invested and no added fees.”
