Super Drawdown Strategy

The plan for how much to withdraw from your super each year in retirement - usually from an account-based pension - balancing the income you need now against making the balance last as long as you want.

Once you start drawing down from an account-based pension, Australian rules also require a minimum withdrawal each year based on your age (typically from about 4% in your 60s up toward 14% at older ages). Whatever strategy you choose in Canwi, the amount withdrawn is modelled to be at least that regulatory minimum. See the Account-Based Pension page for the full age-based minimum rates.

Approaches supported in Canwi include:

• Target age (amortisation-based) - Work backwards from your pension balance to pay a steady, inflation-adjusted income that aims to run the account down to about zero by a chosen age (often around 92).
• Annual amount - Withdraw a fixed dollar amount each year, usually indexed with inflation, until the balance runs out.
• Fixed % of starting balance - Take a set percentage of the balance when the pension starts (for example the well-known ~4% rule), then typically index that payment for inflation.
• Fixed % of current balance - Take a set percentage of whatever the balance is at the start of each year, so the dollar amount rises and falls with the account.
• Minimum withdrawal only - Draw only the age-based regulatory minimum for account-based pensions each year, which tends to preserve more of the balance for longer but may mean less income early on.

You can also take lump sum withdrawals alongside a drawdown strategy - for example keeping an ongoing minimum-withdrawal pension while pulling out a larger one-off amount for a holiday, home renovation, or to clear debt. The ongoing strategy still has to meet the age-based minimum each year; the lump sum is modelled as an additional withdrawal on top. You can also set this up via Shortfall Funding so Canwi automatically draws from super in years where expenses exceed income.

The strategy you choose shapes how much retirement income you receive, how quickly the balance declines, and how sensitive the plan is to investment returns and inflation.