Thinking about taking a large benefit from your self-managed super fund? Believe it or not, there’s a lot to consider in working out how to structure the payment. Just taking a very large pension amount is often the worst possible thing to do.

It’s easiest to explain the thought process using an example. Consider a couple where John, 70, has a pension worth $1.65 million that he started several years ago. At the time he fully used up the limit we all have on the amount that can be converted to a super pension ($1.6 million at that time). John had a very large super balance and so he had super money left over that he just left accumulating in his fund. That account (often referred to as an “accumulation balance”) is now worth $500,000.