Have a TPD claim but need help with what to do next?
Do you want to know how you make your TPD claim best work for you?
A recent Perth customer was recently faced with these questions when receiving a Total and Permanent Disability Payment (TPD).
The single customer, who was in their late 30s, reached out to us as they were in a messy financial situation after receiving their TPD claim payment. They had too many expenses for income and needed to get a good cash flow plan sorted. Below we share how Precision Wealth’s Authorised Representative Glenn Hilber advised a TPD client on how to best manage their TPD Claim and how to make it work for them.
(And yes, we are based in Brisbane but can help clients across the country!)
DISCLAIMER – The information provided in this blog is general and does not consider your individual financial needs or objectives. It does not constitute personal advice. We recommend seeking out professional and independent financial, legal and tax advice which has been designed for your individual situation before acting on any information contained below.
Does TPD payout affect Centrelink?
One of the most frequently asked questions we receive is – does a TPD payout affect Centrelink? The answer is no, not if it is in a superannuation accumulation account which is where TPD claims are generally paid into in the first instance.
This is why it was important that this client retained a fair bit of his insurance proceeds within a superannuation accumulation account, because retaining his Centrelink benefits was going to be critical in making his TPD funds last as long as possible.
The first recommendation that was made to this client was to transfer their TPD claim to another superannuation accumulation fund. We suggested this so the TPD tax-free uplift was applied to their full current balance.
We then recommended commencing a disability pension with some of the money, but just the right amount to keep under the threshold so it wouldn’t impact their disability support pension through Centrelink. A benefit of having as much money within a disability pension without any negative implications is because that money is then invested in a tax free environment giving the client the best investment returns.
Lastly, we suggested taking an initial larger pension payment to clear outstanding bills and debts and then take a small regular pension payment to supplement cash flow. We advised this to ensure the pension payments were under the tax-free threshold and so no tax would be payable.
The above recommendations were made to give our clients the cash flow they needed and still maintain full Centrelink. Not only did this optimise the TPD claim payout in terms of tax, but it also helped maintain their Centrelink disability support pension.
A Good TPD Claim Story
Since enlisting our help, we are happy to say this client followed our advice and now has financial freedom. By structuring their TPD claim payout in the best possible way for their circumstances, they have paid down debt eliminating money worries. They now have a stable cash flow plan because their TPD claim is working as best for them as possible to provide for them over the long term.
TPD Claim Financial Planner Review
We received this feedback from this client after helping them with an investment plan for their TPD claim payout:
“Precision Wealth Management deserves a massive amount of praise for the service, help and advice they gave me in dealing with managing my disability payout. They saved me a substantial amount of money and developed a long-term safe financial plan for me.
Dealing with my super fund was handled professionally by the team at Precision. I never had any problems getting progress updates. Even though Precision are interstate from my location, the communication was of such great quality it seemed like they were right next door.
Glenn, Carly, Nicole and the whole Precision Wealth team are professional, and experienced and explain things in a way that you can understand. They managed the whole process for me without a hitch. I highly recommend them in regards to any financial help. I cannot thank them enough for the guidance I was given. Thanks Precision!” – Tim
Make Your TPD Claim Story a Positive One
If you have a TPD claim payout and need help making your money work for you, Precision Wealth Management is here to help.
Our team of financial advisers specialise in helping people in your situation maximise their payout.
We have helped many other individuals and families to secure their Financial Futures.
Contact Precision Wealth today to learn more about how they can help you.