If your salary or SERCAT changes during your career, this may change the amount of your final benefit.
While you’re serving
When you leave the ADF
If you’re medically separated from the ADF, you may be eligible for invalidity benefits. If you die and are survived by a spouse or children, they may be eligible to receive death benefits.
Pension
Important: If you choose to commute some of your pension for a lump sum, this will permanently reduce your fortnightly pension amount. Your pension entitlement will not change if you outlive the life expectancy used to determine your reduction. Before making any decisions about your super, you should seek independent financial advice.
Productivity benefit
MSBS Ancillary Benefit
Work out your pension amount
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Determine the percentage of pay that applies to your completed years of effective service
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Multiply your final annual salary by your percentage of pay
Before making any decisions about your super, you should seek independent financial advice.
Susan, aged 55, has completed 37 years of service in the ADF, with a final salary of $160,000 a year.
The percentage of pay amount for 37 years’ service is 67.75%.
Susan’s annual pension benefit will be $108,400 ($160,000 × 67.75%) or $4,157.81 a fortnight before tax.
If Susan commutes:
Susan chooses to commute 5 times her annual pension benefit, which is $542,000 (108,400 × 5).
Her life expectancy factor as a female aged 55 is 23.63.
Susan’s pension reduction amount is $22,936.95 ($542,000 ÷ 23.63).
Susan’s annual pension benefit will be $85,463.05 ($108,400 – $22,936.95) or $3,278.03 a fortnight before tax.
So, when Susan leaves the ADF, she will have:
- a commutation lump sum of $542,000 paid as cash (before tax)
- an annual pension of $85,463.05 paid fortnightly (before tax)
- a productivity benefit, rolled over to another superannuation fund (as she is under preservation age).