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Retirement Planning for High-Income Professionals
The five to ten years before retirement are the most strategically valuable years of your financial life. Contribution caps are still available. Income is still flowing. Tax structuring decisions still compound. And the window for correcting gaps in insurance, super, and estate planning is still open.
Build MyWealth works with professionals who are not yet retired but who recognise that the transition from earning to drawing requires coordination across superannuation, tax, insurance, and estate structures. The question at this stage is not “when can I retire?” The question is “have I positioned every structure to work as efficiently as possible before I stop working?”
This page covers the three core pre-retirement strategies for high-income professionals: transition to retirement (TTR), downsizing contributions, and pre-retirement super maximisation. It does not cover post-retirement drawdown, pension phase income streams, or aged care planning. Those are separate conversations that follow once a retirement date is confirmed.
Transition to Retirement: Not What It Was, Still Worth Understanding
Transition to retirement strategies changed materially after 1 July 2017 when the government removed the tax exemption on earnings supporting TTR income streams. Before that date, TTR pensions were a straightforward arbitrage: move super into pension phase, pay zero tax on investment earnings, salary sacrifice pre-tax income back in, and pocket the tax differential. That arbitrage is closed. TTR income streams in the pre-retirement phase are now taxed at up to 15% on earnings, the same rate as accumulation phase.
The strategy still works for specific client profiles, but the threshold is higher. A TTR strategy is generally worth modelling for professionals who are aged 60 or older, are still working (full time or part time), have a marginal tax rate above 30%, and have sufficient superannuation balance to generate meaningful income stream payments within the legislated 4% to 10% annual payment range.
The mechanics: you open a TTR income stream using a portion of your super (minimum balance requirements apply, typically $10,000 to $30,000 depending on the fund). You continue working and receiving employer SG contributions into your accumulation account. The TTR income stream pays you between 4% and 10% of the account balance per year. If you are 60 or older, those payments are tax-free income to you personally. Meanwhile, you salary sacrifice an equivalent amount back into super, which is taxed at 15% (or 30% if Division 293 applies). The net effect is a tax saving equal to the difference between your marginal rate and the contributions tax rate, multiplied by the amount cycled through the strategy.
Illustrative scenario: A senior architect aged 62, earning $320,000, transfers $400,000 from accumulation into a TTR income stream. She draws the maximum 10% ($40,000) as tax-free income. She salary sacrifices $40,000 of her pre-tax salary into her accumulation account. Her take-home pay stays the same. The salary sacrifice is taxed at 15% ($6,000) instead of her marginal rate of 47% ($18,800). The annual tax saving is approximately $12,800 before Division 293 considerations. Over five years to retirement, this compounds to over $64,000 in additional super, even before investment returns on the recycled amounts. This is a general illustration only and does not represent an actual client outcome.
When TTR Does Not Work
Downsizing Contributions: $300,000 Per Person Outside the Caps
The downsizer contribution allows individuals aged 55 or older to contribute up to $300,000 (or $600,000 per couple) from the proceeds of selling their main residence directly into superannuation. This contribution does not count towards concessional or non-concessional caps and is not restricted by total superannuation balance.
For high-income professionals, the downsizer contribution is typically most valuable when combined with other pre-retirement strategies. A professional who has already maximised their concessional and non-concessional contributions can use the downsizer contribution to inject an additional $300,000 into the concessional super environment without any cap impact.
The key eligibility requirements: you must be 55 or older at the time of contribution, the property must have been owned by you or your spouse for at least 10 years, the property must qualify (fully or partially) for the main residence CGT exemption, and the contribution must be made within 90 days of receiving the sale proceeds (usually settlement).
Strategic Considerations for High-Income Professionals
Illustrative scenario: A GP couple, both aged 63, sell the family home for $2.4 million and purchase a smaller property for $1.5 million. They each contribute $300,000 to their respective SMSFs as downsizer contributions, adding $600,000 to their combined super. The husband’s balance increases from $2.6 million to $2.9 million, remaining below the $3 million Division 296 threshold. The wife’s balance increases from $1.8 million to $2.1 million, reaching the general transfer balance cap but remaining below the Division 296 threshold. The tax-free component of their super increases by $600,000, reducing potential death benefit tax if benefits are eventually paid to adult non-dependant children. This is a general illustration only and does not represent an actual client outcome.
Pre-Retirement Super Maximisation: The Final Contribution Window
Illustrative scenario: A law firm partner aged 64 plans to retire at 67. Her current super balance is $1.2 million. Over the next three years, she maximises concessional contributions (using carry-forward), triggers the bring-forward rule for a $360,000 non-concessional contribution from the sale of an investment property, and her employer continues SG at 12%. By retirement, her projected balance is $1.95 million, close to the general transfer balance cap of $2.1 million (from 1 July 2026), allowing her to transition almost the entire balance into a tax-free retirement income stream. This is a general illustration only and does not represent an actual client outcome.
Division 296 and Pre-Retirement Decisions
The Build MyWealth Pre-Retirement Coordination Review
Frequently Asked Questions
Sangram Rana is an IFA Excellence Awards finalist: Risk Adviser of the Year 2022, 2023, and 2025, SMSF Adviser of the Year 2022 and 2023, and Client Outcome of the Year 2022. Published in the Australian Financial Review, Money and Life, SmartCompany, Inside Small Business, Professional Planner, Life Insurance Guide, CommBank Brighter Magazine, and Benefolk. Corporate Authorised Representative, Lifespan Financial Planning AFSL 229892.
Are You Making the Most of Your Final Contribution Years?
Build MyWealth is a trading name of Accounting Cloud Pty Ltd. Sangram Rana is a Corporate Authorised Representative (ASIC No. 1306106) of Lifespan Financial Planning Pty Ltd (AFSL 229892). Level 1, 55 Collins Street, Melbourne VIC 3000. Phone: 03 7034 4888. This page contains general information only and does not constitute personal financial advice. Financial Services Guide (Lifespan): Refer to lifespanfp.com.au. Privacy Policy: buildmywealth.com.au/privacy-policy
This content reflects legislation and ATO rates as at March 2026. The 2026-27 contribution caps referenced are based on AWOTE indexation data published by the ABS, pending formal ATO confirmation. Division 296 received Royal Assent on 13 March 2026. Subject to change pending further legislative or regulatory development. Further ATO guidance and regulations may clarify administrative details.