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Advice needed please

Discussion in 'Superannuation, SMSF & Personal Insurance' started by Wishiwasbetter, 1st Oct, 2014.

  1. Wishiwasbetter

    Wishiwasbetter New Member

    1st Oct, 2014
    Bush, NSW
    Hello all.

    I am a new member here and would very much appreciate some knowledgeable advice.

    Some time ago I was medically assessed as being TPD. One of the options available to me was to take my TPD insurance payout as a lifetime pension - which I have done. This pension has a taxed and untaxed element with the taxed element attracting the 15% offset. This offset effectively reduces the tax on my pension to zero. I am under 55.

    Taking the payout as a pension has obviously left me with no superannuation (however the pension continues until my death).

    I have a reasonable sum of money residing in a HIS account which has grown to the point where the interest earned, once added to the taxed element of my pension, is now causing me to be liable to pay tax once again. Before I ask my questions I would just like to say that I have NO PROBLEM paying tax as required and I am not interested in "hiding" money to avoid tax, but keen to know whether I am managing things to my full benefit.

    My first question is - Should I just leave the money I have in savings in the HIS and treat the interest as earnings and not change anything (it is nice knowing I have money available for problems that arise)?

    Secondly - Should I put that amount into opening a super account and why should/shouldn't I do that? I would theoretically be able to access it any time I want as I can satisfy a condition of release even though I am under 55 (i.e. TPD) BUT I would imagine that anything I take out would be included as taxable income. Is that correct? Are there special rules for TPD people?

    Thirdly - If these two options are not the best - what is? Am I missing something important?

    I probably have many more questions but I don't want to scare off everyone!!
    Any help would be great as I live in a very small town with no financial advisers and I want to make sure I am not ruining things for my future.

    Thank you in advance.