Set up a pension in super
First, I think the fee that you have been asked to pay for financial advice seems on the high side, particularly from a bank planner, though the bank you went to has a reputation for charging excessive fees. Find an adviser who has good reviews from clients and who is well qualified and works nearby.
If you want guaranteed returns you really can only use a bank with term deposits. Because Bill is working, he pays some tax now – $2700 last year. So it may be worth considering moving your money into superannuation and then starting an account-based pension (or income stream). The latter will have zero tax on the earnings and zero tax on the payments.
When you do this, you will need a super fund that offers you bank term deposit rates and pays well on cash rates. The rate will be low but that is the price for zero volatility. Avoid anything that sounds like a term deposit but pays an attractive interest rate (such as a debenture). Many investors have lost money in these types of products over the years. Stick with a bank.
Your adviser will be able to work out how much money you should withdraw through the income stream, and should also model for you how long the money might last.
Whether you hold your money in an ordinary bank account or in the super/income stream environment won’t make a big difference to your aged/disability pensions. The money will still have a “deeming” rate applied to it in any event – 1.75% on the first $81,600 and 3.25% above that.
Bill, you earn $32,000 a year from your delivery jobs and enjoy the work. You receive $400 a week each from Centrelink and now you are also getting a UK pension that equates to $88 a week. So you are already getting your $1000 a week. Your wish is consistent with the ASFA retirement standard, where a modest retirement for a couple is $670pw while a comfortable retirement is $1153pw. So you’re not being greedy!
Therefore, you should only need to take the minimum amount from your income stream, which starts for you at 5%, or $279pw. This money could go into a “holiday account” – you could use it for your annual break, or for any emergency spending.
Bill, you will be able to contribute a non-concessional $100,000 a year into super. So you may need to organise your contributions over a period of time.