The myNorth Deferred Lifetime Income Account is a flexible financial product designed for retirees, offering a hybrid approach to superannuation that can enhance retirement income, improve Age Pension eligibility, and manage tax liabilities while still allowing for accumulation.
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the my North deferred lifetime income
account is a unique hybrid solution that
can span both accumulation and
retirement it offers advisors a
sophisticated strategic opportunity to
offer value to their retiree clients it
is available to clients who have met a
condition of release and provide
tax-free earnings bonuses and continued
benefits the account allows for
contributions rollovers and lumsum
withdrawals bya commutations offering
flexibility to achieve a range of
outcomes including potentially
maximizing retirement income increasing
age pension eligibility and limiting tax
while still accumulating super a my
North deferred lifetime income account
can be opened from age 60 after meeting
a full condition of release and it's the
first pension account in Australia that accepts
accepts
contributions clients can access the
full range of investment options from
North's extensive pension and super menu
and the account provides the option to
defer the income stream up to age 100
while accessing commutations up to the
maximum withdrawal rate when clients are
ready to commence an income they can can
easily transition into a my North
lifetime income
account in this video we will explain
the key benefits of a my North deferred
lifetime income account how it works
hard to provide your clients with the
possibility of more age pension and the
way it can seamlessly roll into a my nor
lifetime income
account my nor deferred lifetime income
accepts ongoing contributions and
rollovers with tax-free earnings there's
no need to specify a deferral end date
and clients can start the income phase
after 12 months by converting to a
lifetime income account clients May gain
substantial age pension benefits as
investment earnings are not included in
Center Link's assets test and there is
no income test these values can also be
substantially reduced by
commutations invest from North's full
super and pension menu including managed
portfolios payment of an insured annual
bonus ensures the client has income for
Life the optional money back death or
exit benefit means clients can receive
paid consider a typical client the
client is a 60-year-old single male who
recently commenced a new job with an
income of
$100,000 as he ceased his his previous
employment Arrangement after age 60 he
has satisfied a condition of release he
has $300,000 in super with his employer contributing
contributing
12% what's the client's goal he wants to
retire at age 70 with a regular income
that will never run out and to put aside
money for lifestyle
expenses in this example the client's
financial advisor suggests that
$150,000 or half of the super balance
goes into a deferred lifetime income
account the other half remains in a
standard super account the client
decides to split super contributions
evenly between the two accounts and
we're assuming an investment profile
that generates 6% net of investment
earnings and platform Administration
fees when the client reaches 70 he is
ready to retire the standard super
balance has compounded annually by
investment earnings and contributions
and is worth just over
$300,000 the full value will be assessed
by centerlink for the age pension assets
test the Deferred lifetime income
account balance has compounded annually
by the same investment earnings and
$340,000 that's approximately
$28,000 more than the standard super
balance because there is no investment
earnings tax each year and the annual
bonus is topping up the Deferred
lifetime income account additionally
deferred lifetime income accounts acre a
cink purchase amount equal to all
contributions less commutations but not
including investment earnings in this
$21,000 a further 40% discount is
applied to the purchase amount which is
then assessed by sink for the age
pension assets test as such only
$120,600 or 35% of his actual deferred
lifetime income account balance is
accessible at age 70 if the client
chooses to commute
$20,000 this would further reduce the
purchase amount dollar for dollar to
$181,000 which centerlink would then
discount to
$118,000 $600 for their asset test
assessment the client might choose to
use commutations to subsidize income
both in pre-retirement and in retirement
to potentially improve centerlink
benefits this strategy can alter
outcomes moving into retirement at age
70 the client is also a homeowner with
$100,000 in other assets
turning to income needs the client has
an annual income goal of $660,000 in
today's dollars indexed to CPI to
achieve this a financial advisor can
transition the Deferred lifetime income
account into a lifetime income account
and transition standard super into an account-based
account-based
pension remember the client had a
reduced purchase amount in the Deferred
lifetime income account and therefore a
lower amount counting towards the
centering assets test that means he will
receive over $10,000 in additional age
pension in year one of retirement rather
than zero without my North lifetime the
client can also sustain a $60,000 income
goal for an additional 5 years due to
the increased age pension and my North
lifetime income received each year they
may be able to further improve their
income and centerlink outcomes by
holding their deferred lifetime income
account for longer during retirement and
substituting commutations for income
even when the account-based pension
depletes at age 95 the minor lifetime
income account continues to pay income
for Life the client will never need to
rely on the age pension
alone while the Deferred lifetime income
account can assist client in many ways
it also has four key benefits for
advisers more flexibility to manage your
clients income goals in retirement the
ability to influence center link
outcomes for your clients freedom to
invest from North extensive pension and
super menu and opportunities to engage
with clients over the long term and
support their ongoing retirement needs
to learn more about my North lifetime
solution Solutions and their benefits
for advisers and their clients please
view the full range of videos in this
series from how the asset test benefits
work to maximize age pension to the
Dynamics of creating income for life we
provide all the details you need when
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