A new option for your retirement income — an income you can’t outlive, and often a bigger Age Pension alongside it.
Most retirees draw their income from an account-based pension. It’s simple — you control how much comes out, and when. The downside: Centrelink counts every dollar of it against you, for as long as you have it.
An IRIS works differently. It pays you an income for the rest of your life, no matter how long that is or what markets do. You give up full access to a portion of your money, and in return you get an income you can never outlive — plus better treatment from Centrelink.
Most people don’t put everything into an IRIS. They keep some in a normal account-based pension for flexibility, and add an IRIS on top for guaranteed income and a Centrelink boost.
Why it can mean a higher Age Pension
Centrelink counts an account-based pension in full — 100% of the balance. An IRIS is counted much more lightly — only 60% at first, dropping to 30% after several years. The same goes for the income you receive: 100% counted for an account-based pension, only 60% for an IRIS.
Less counted by Centrelink can mean a higher Age Pension.
Worked example — David and Karen, both 67. They own their home and have $900,000 in super for retirement income.
| Without an IRIS | With an IRIS | |
|---|---|---|
| How it’s set up | $900,000 in an account-based pension | $600,000 account-based pension + $300,000 IRIS |
| Counted by Centrelink | $900,000 | $780,000 |
| Combined Age Pension | $663 a fortnight | $1,023 a fortnight |
+$360 a fortnight — about $9,360 a year, plus a Pensioner Concession Card and the savings it brings on medical costs.
A made-up example to illustrate the idea — not a real client and not a recommendation. Everyone’s numbers are different.
What happens if you die?
This is one of the most common questions, so it’s worth answering plainly.
Account-based pension
Whatever is left in the account goes to your family — or whoever you’ve nominated — as a lump sum, straight away.
IRIS
This works differently, because your money has been pooled to fund a guaranteed income for life. Most IRIS products pay a reducing amount if you die — a larger amount in the early years, less as time passes, and sometimes nothing at all once you’re well into retirement.Some products let you plan for this. AMP’s MyNorth Lifetime, for example, lets you nominate a partner as a reversionary beneficiary — if you die, your income simply continues for them, uninterrupted. But if you’re single, there’s no one for it to revert to, so the standard declining death benefit applies instead. This is worth thinking about if you’re single and weighing up an IRIS — the guaranteed-income trade-off has a different shape when there’s no partner to pass the income on to.
For example: A single person with $600,000 in an account-based pension and $300,000 in an IRIS, who passes away partway through retirement: the account-based pension portion — less whatever’s been drawn down — goes to their family in full. The IRIS portion only pays out what that particular product allows at that point in time, which could be a meaningful amount, a small amount, or nothing, depending on how the product is designed and how long they’ve held it.
This is exactly why the death benefit terms of a specific product need to be checked carefully before committing money to it — and why most people keep a solid account-based pension alongside an IRIS, rather than putting everything into one.
Is it right for you?
An IRIS tends to suit people who have more in super than the Age Pension thresholds allow, want an income they can’t outlive, and are comfortable giving up some access to that portion of their money. It isn’t for everyone — the fees, the reduced access, and the death benefit terms are all worth weighing up with proper advice.
Wondering how this looks with your numbers? Every situation is different. We can model an IRIS against your own super balance, home ownership and Age Pension position before you decide anything.
Amie — amie@rekabadvice.com.au · rekabadvice.com.au
General information only, not personal advice — figures current as at September 2026. Rekab Advice is a trading name of Rekab Enterprises Pty Ltd (ABN 22 607 854 240), a Corporate Authorised Representative (No. 338235) of LFG Financial Services Limited (AFSL 227096).