The temporary minimum pension drawdown rates are being extended

The reduced minimum pension drawdown rate for the 2019-20 and 2020-21 financial years is being extended into the 2021-22 financial year.

What is the pension drawdown rate?

Each year, you’ll need to take out a minimum amount from your pension as a form of income. This is usually a percentage of your starting balance on 1 July of the current financial year and the exact amount usually depends on your age at that date.

This minimum rate was reduced for the 2019-20 and 2020-21 financial years.

Why did the rate change?

With COVID-19 severely impacting financial markets, the Government announced in March 2020 a temporary reduction in the minimum amount you needed to withdraw for the 2019-20 and 2020-21 financial years.

As we’re still living in uncertain times, this change has been extended to the 2021-22 financial year, meaning you can leave more money in your super for later.

So, what are the new pension drawdown rates?

Below are the temporary minimum withdrawal amounts for Rest Pension Retirement and Transition to Retirement account members. 

Your age on 1 July or commencement of pension*

Default minimum drawdown rate (% of account balance)

Reduced minimum drawdown rates for 2019-20, 2020-21 and 2021-22 (% of account balance)

Younger than 65

4 2
65-74 5 2.5
75-79 6 3
80-84 7 3.5
85-89 9 4.5
90-94 11 5.5
95 or older 14 7

If you have a Rest Pension Term Allocated Pension, for 2021-22 the minimum allowable amount will be 45% of your annual pension amount, rather than the usual 90%.

Is your investment strategy right for you? 

Just answer some short and simple questions with our Investment Choice Solution and we’ll recommend how your money held with Rest should be invested.

*If your Rest Pension starts part-way through the year, your minimum payment is pro-rated.