is an income stream right for you?

For many members, a HESTA Retirement Income Stream can be a smart way to access super savings in retirement — offering flexible, tax-free income from the money you've worked your whole life to save. But it's not always an easy decision, and the questions members ask before making the switch are usually very similar. Here are the five we hear most often.
 

1. I’m worried I’ll lose control over my money. How flexible is a HESTA Retirement Income Stream?

The government has set a minimum amount that must be paid to you each year but as long as your annual payments meet this minimum, you can decide how much you're paid and how often. And if something comes up and you need some extra money, you can easily apply to take out a lump sum payment at any time.
 

2. What if I don’t need all the money I have to draw down?

If you’re worried that the minimum drawdown amount is too much, you can re-invest any extra money into an accumulation account until you’re 75. We can help you with this.

If you’re planning on applying for the Age Pension you may be worried that having extra money could affect your pension entitlements. It’s worth knowing that, whether your money is in super, an income stream or your bank account, it will generally be assessed by Centrelink in the same way.
 

3. I don’t really understand the tax benefits — is it worth it?

Once you move your super into an income stream, you generally pay zero tax on your income payments and investment earnings from age 60. However, when your super stays in the accumulation phase, your investment earnings are taxed at up to 15%.

Here’s a simple example^*: Say you’re 66 and you have a balance of $100,000 earning a 6.5% return — that's $6,500 in investment earnings in a year.

In accumulation, you'd pay 15% tax on those earnings — $975 gone before you see it. Generally in an income stream, there’s no tax, so you keep all of it.

Over 10 years, that difference could add up to tens of thousands of dollars — money that stays invested and keeps compounding in your favour.

Our research shows that in FY2025, the 83,000 eligible HESTA members who had not transitioned to the retirement phase collectively missed out on an estimated $69 million in tax-free investment returns¹.

You can read more about this here.
 

4. How does the HESTA Retirement Income Stream work with the Age Pension?

The HESTA Retirement Income Stream is designed to work alongside the Age Pension — not replace it. For most HESTA members, the combination of super drawdown and Age Pension is what funds their retirement.

You can read more about income layering here.
 

5. Is it hard to apply?

Applying for a HESTA Retirement Income Stream account is straightforward. The easiest way to apply is directly from your secure member account.

Before you start your application, make sure you've got this information handy:

• your driver licence or other proof of identity (it’s important this matches the name recorded in your HESTA account)
• your bank account details (this is where we’ll pay your income stream payments).

And be prepared to make decisions about:

• how much you want to get paid and how often
• who you’d like your super to go to when you pass away
• how your money should be invested.

^* For illustrative purposes only

¹ HESTA Default Retirement Research, Quantifying the impact of a default retirement transition mechanism, Laneway Analytics, 5 December 2025.