Pension Account or Accumulation Account

Discussion in 'Superannuation, SMSF & Personal Insurance' started by John Smith, 1st Jun, 2019.

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  1. John Smith

    John Smith Well-Known Member

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    Hi All.

    If you have 1.6m in pension mode and this earns 6% (96k) for the year, then taking into account compulsory 4% drawdown (64k), am I correct to assume that the 32k leftover stays in the pension account, or must it go into an accumulation account?
    If it stays in the pension account, does that mean that if this account earns 6% again the next year, it is based on 1,632,000 not 1.6m?
    Is there a limit to how much this can add up to in the pension account e.g. if it is invested well, it could be over 2m as long as the compulsory 4% is withdrawn each year
    Look forward to responses.
    Thanks
     
    John Smith, 1st Jun, 2019
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  2. Hodor

    Hodor Well-Known Member

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    It can grow from my understanding. Cap is only applied to starting balance.
     
    Hodor, 1st Jun, 2019
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  3. John Smith

    John Smith Well-Known Member

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    Hi Hodor.
    Can you tell me where I can read about this?
     
    John Smith, 1st Jun, 2019
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  4. Hodor

    Hodor Well-Known Member

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    Hodor, 9th Jun, 2019
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  5. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Terry_w, 11th Jun, 2019
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