Changes to fees, investments, and drawdown rates for your Income Stream account
December 31 2024
Significant event notice
ESSSuper acts in our members' best interests and is committed to optimising our members' superannuation outcomes.
Effective 1 July 2023, we are making some important changes to your ESSSuper Income Stream account(s) regarding:
- Ongoing administration fee reduction
- Administration fee rebate to members with an open Income Stream account at 31 May 2023
- Investment option name and classification changes
- Minimum drawdowns reverting back to pre-pandemic rates.
1. Ongoing administration fee reduction
Our new administration systems are more efficient, so we are reducing administration fees on Income Stream accounts. This is in line with our 'profit-to-member' ethos and will help to increase members' retirement benefits.
Administration fees and costs are made up of an account-keeping fee and an administration fee. From 1 July 2023, the account-keeping fee will remain as $52 per annum but the administration fee will reduce from 0.25% to 0.20% per annum.
Additionally, the administration fee cap will reduce from $2,120 to $750 per annum.
| Fee type |
Before 1 July 2023 (per annum) |
From 1 July 2023 (per annum) |
| Account-keeping fee |
$52 |
$52 |
| Administration fee |
0.25% |
0.20% |
| Cap on total administration fees and costs |
$2,120 |
$750 |
What this means for you
These reductions will come into effect automatically on 1 July 2023, meaning you don't need to take any action. The below are two examples for comparison.
Example 1
Sam has an Income Stream account balance of $100,000.
Currently, their total administration fees and costs are $302 (i.e. a $52 account-keeping fee and a $250 administration fee).
Due to the fee reduction from 1 July 2023, Sam's total administration fees and costs will be $252 (i.e. a $52 account-keeping fee and a $200 administration fee). That's a saving of $50 per annum.
Example 2
Li has $400,000 in her Income Stream account.
Currently, Li's total administration fees and costs are $1,052 (i.e. a $52 account-keeping fee and a $1,000 administration fee).
Due to the reduced cap from 1 July 2023, her total administration fees and costs will be $750 (i.e. a $52 account-keeping fee and a $698 administration fee). That's a saving of $302 per annum.
Important notes:
- The examples above have been created to demonstrate the broad impact of changes to Income Stream administration fees and costs prior to and from 1 July 2023 on different account balances.
- These examples are provided for illustrative purposes only and assume that each balance has been maintained in the fund for a full year. Fees and costs have been calculated in accordance with the administration fees and costs published in the Income Stream Product Disclosure Statement (PDS) issued 5 December 2022 and the new Income Stream PDS to be issued on 1 July 2023. These examples do not include all fees and costs. You should review the Income Stream PDS for more information about fees and costs.
- These examples are not a promise or guarantee of the savings you may receive.
2. Administration fee rebate to members with an open Income Stream account at 31 May 2023
As we have gained efficiencies from our new administration system this financial year, we are able to rebate a portion of this year's administration fees for Income Stream accounts.
This rebate will be calculated as the equivalent of the scheduled administration fee reduction of 0.05% of your Income Stream account balance at 31 May 2023. It will be applied by adjusting the unit prices for Income Stream investment options on 31 May 2023.
What this means for you
This rebate will be applied to the Income Stream investment options' unit prices automatically on 31 May 2023, meaning you don't need to take any action.
3. Investment option name and classification changes
We are renaming six of our nine investment options for Income Stream accounts from 1 July 2023.
Additionally, from 1 July 2023 our investment options will be put into two classifications: diversified options and single asset class options.
We are making these changes to our investment options to make them easier to understand and the terminology more compatible with that used by other super funds.
| Current investment option name |
Investment option name from 1 July 2023 |
| Diversified options |
| High Growth |
Growth |
| Basic Growth |
Balanced Growth |
| Ethically Minded |
Ethical Diversified |
| Growth |
Balanced |
| Balanced |
Conservative |
| Conservative |
Capital Stable |
| Defensive |
Defensive |
| Single asset class options |
| Shares Only |
Shares Only |
| Cash |
Cash |
What this means for you
These are changes to investment option names and classifications only. The underlying strategic asset allocations and target returns will not be impacted. They will come into effect automatically on 1 July 2023, meaning you don't need to take any action.
Investment options aren't available in ESSSuper's defined benefit super schemes, which are guaranteed by the Victorian State Government and are not impacted by investment performance.
4. Minimum drawdowns reverting back to pre-pandemic rates
On 1 July 2020, the Federal Government mandated a temporary 50% reduction to minimum drawdown rates as part of its response to the global COVID-19 pandemic. This reduction will end on 30 June 2023.
The minimum drawdown rates will return to the previous levels from 1 July 2023.
| Age(s) |
Temporary minimum drawdown rates until 30 June 2023 |
Minimum drawdown rates from 1 July 2023 |
| Under 65 |
2.0 |
4.0 |
| 65 to 74 |
2.5 |
5.0 |
| 75 to 79 |
3.0 |
6.0 |
| 80 to 84 |
3.5 |
7.0 |
| 85 to 89 |
4.5 |
9.0 |
| 90 to 94 |
5.5 |
11.0 |
| 95 or more |
7.0 |
14.0 |
What this means for you
If you have currently chosen the minimum drawdown rate, your drawdown amounts after 1 July 2023 will be recalculated automatically and your pension payments will increase to the new rate, meaning you don't need to take any action.
If you have a nominated drawdown rate, you will only be affected if your nominated drawdown rate is below the new minimum. In this case, your pension payments will increase to the new minimum.
Members that have selected the maximum drawdown rate for their Working Income Stream will not be affected.
We're here to help
You can book an appointment with one of our expert Member Education Consultants for general advice about your ESSSuper account(s). If you're looking for personal advice relating to your financial situation or needs, our qualified Financial Advisers* can help. To request an appointment, please call us or use our online enquiry form.
A copy of this significant event notice will be available to download by logging into your Members Online inbox.
From 1 July 2023, the changes described in this document will be updated in the relevant Product Disclosure Statement (PDS) and associated guide(s), on our website, and in Members Online where applicable.
If you have any questions, please contact us on 1300 650 161 (Emergency Services members) or 1300 655 476 (State Super members) between 8:00am and 5:00pm Monday to Friday, or email us at info@esssuper.com.au
Warm regards
Duncan Winton
Group Executive, Strategy, Brand & Insights