What is the difference between superannuation and a pension? | RateCity

Your superannuation has two phases - the accumulation phase and the pension phase. During the accumulation phase, you and your employers are putting money into your super account. 

Later, once you fulfill certain age and employment status conditions, your super account moves into the pension phase, and you may now receive money from your super. You can get a super income stream as a series of regular payments. These could be paid to you weekly, monthly, or quarterly but must be paid at least once a year. This super income stream is also called a pension or annuity.

Your super income stream or pension will continue until there is no money left in your super account. You may choose to convert a super income stream into a super lump sum if your fund allows it. After your death, your named beneficiary is automatically entitled to receive the remaining super balance.

The Age Pension helps eligible older Australians to receive income support and a range of concessions. From 2023, you’ll need to be 67 years of age or over and an Australian resident to qualify. 

Income test for the Age Pension
Services Australia will assess you and your partner’s income from all sources to determine if you qualify for the Age Pension. This includes financial assets such as superannuation, savings accounts, term deposits, managed investments, loans, debentures, listed shares and securities. They use a process called deeming, which is a set of rules to estimate the income from your financial assets. 

If you’re a single person and your income is deemed to be under $190 per fortnight, you are eligible for your full pension, subject to other conditions being fulfilled. The pension reduces by 50 cents for each dollar over $190 of deemed income. As a couple, you receive your full combined pension if your deemed income is below $336 per fortnight, subject to meeting other conditions such as the asset test. 

Asset test for the Age Pension
How much pension you can get also depends on the value of all your assets (not including the family home) and whether you’re single or in a relationship. The range of total asset value eligible for the pension is given in the following table:

If you receive the Age Pension, you’ll also get a Pensioner Concession Card which assists you with lower costs for healthcare and medicines as well as other discounts within your community.