your income stream questions answered

Whether you have a HESTA Retirement Income Stream (RIS) or a Transition to Retirement (TTR) account, it’s natural to have questions about how it works.

We want to help you feel more confident about your retirement income, so we sat down with HESTA Advice Manager Alan Sher to answer some of the most common questions from our income stream members.

Can I add more money to my income stream (e.g. an inheritance or downsizer contribution)?

Once your income stream is set up, you can't add additional funds directly into that same account.

Alan says that all income streams, including RIS and TTR accounts, have specific tax rules.

“New money, like an inheritance or downsizer contribution, can be added to your super,” Alan says.

“However, it must go into a new super ‘accumulation’ account first.”

If you’d like to set up a new super account, give us a call and we can help.

Once your new account is open and the contribution has been made, you can then choose to start a new income stream - if it’s right for you - to combine your retirement savings.

This ensures correct ATO reporting and maintains your income stream's tax advantages, like tax-free investment earnings for RIS accounts and tax-free income payments for all income streams.

Can I change the amount of income I receive?

Yes, HESTA income streams are designed to be flexible. You control the income amount and payment frequency (e.g. fortnightly, monthly, quarterly, or annually), within limits set by the government.

“All income streams have government-set minimum drawdown rates each financial year, based on your age and your account balance at 1 July,” Alan says.

“If you have a TTR, you can’t receive more than 10% of your account balance in one financial year.

“As long as you meet the minimum (and stay below the maximum for TTR accounts), you’re free to adjust your payments according to your needs.”

You can do this in your online account or by completing the Change of income payment form (PDF).

Can I take a lump sum out of my income stream?

Yes, you can, depending on the type of income stream you have.

HESTA income streams offer flexibility for both regular income and lump-sum payments when needed—whether it’s for travel, a home project, or unexpected bills.

“You’re not locked in to just regular payments,” Alan says.

“Access to lump sums depends on your income stream type, but any lump sums you take are generally tax-free if you’re over 60.”

Here’s how lump-sum withdrawals work:

• For RIS accounts: You can generally make tax-free lump-sum withdrawals any time if you’re over 60.
  
  
• For TTR accounts: Lump-sum withdrawals are generally not permitted unless you meet a condition of release. Until then, you can only receive regular income payments within the minimum and maximum drawdown limits.

Importantly, lump sums don’t count towards your minimum annual income drawdown. This means you can withdraw extra funds without impacting your regular payments.

You can request a lump-sum withdrawal in your online account or by completing the Income Stream lump sum withdrawal form (PDF).

I’ve started working again. Will this affect my income stream?

No, income streams are generally not affected by additional work, depending on your stage of life. If you have a RIS account that was started after you retired and you’ve met a condition of release, it won't be affected.

“The great thing about a RIS account is that you can return to work and your income stream continues paying you tax-free income, regardless of your work status,” Alan explains.

“However, if you’re still working and have a TTR account, your work situation changing may affect your reasons for using it.

“It’s worth reviewing your situation, as you might want to adjust your payments.”

The way your TTR account is assessed and taxed doesn’t change based on whether you’re working more or less—but your goals might. Speaking with a HESTA adviser can help you stay on track.

If you’re receiving the Age Pension, you’ll need to let Centrelink know about any additional income within 14 days. Under the Work Bonus, eligible pensioners can earn $300 a fortnight without reducing their pension.

Learn more about returning to work after retirement.

When can I start an income stream? Is it the same age as the Age Pension?

You can generally start an income stream from age 60, while you must be 67 years old to be eligible for the Age Pension. For a RIS, you need to have met a condition of release.

If you’re still working and you’ve reached age 60, a TTR account might suit your needs. If you’ve permanently retired or you’re over 65, a RIS account may be more appropriate.

“You can start an income stream any time after age 60,” Alan says.

“It’s up to you and what works for your personal circumstances.”

Learn more about starting an income stream.

What happens to my income stream when I pass away?

Planning ahead is important. You can nominate who receives your income stream balance upon your death, through three types of nominations:

1. Reversionary: This automatically continues your income stream payments to an eligible beneficiary (usually your spouse). The account transfers to their name, and payments continue.
   
   
2. Binding: This legally directs us to pay your balance to a valid and eligible beneficiary, being your spouse, child, a financial dependant or a person with whom you have an interdependency relationship, or your legal personal representative.
   
   
3. Non-binding: This guides us on your wishes, but we’re not legally bound. We’ll consider your nomination and decide who to pay in accordance with superannuation law.

To ensure your wishes are clear, make sure your nomination is valid and up to date. If you’re unsure about your options, we recommend seeking legal and financial advice.

“Your nomination is key to ensuring your money gets into the right hands,” Alan says.

Learn more about nominating a beneficiary.

Can I change my beneficiary nomination for my income stream?

Yes, you can change your binding or non-binding beneficiary nominations at any time. This is important if your personal circumstances change, for example, if a nominated beneficiary passes away before you.

“Life changes, so reviewing your nomination is key to ensuring your wishes are clear,” Alan says.

It’s important these changes are made correctly. Verbal or email requests are not binding. You will typically need to complete specific paperwork, and some nominations may require witnesses.

Note: Reversionary nominations can currently only be set up when you initially establish your income stream and can’t be changed.

To make or update a binding death benefit nomination, please complete the Binding death benefit nomination form (PDF).

You can check and manage your non-binding nomination in your online account.

Consider whether this product is appropriate for you by reading the PDS and TMD at hesta.com.au/pds.