If you have stopped working and receive an unexpected windfall, getting professional financial advice is the best place to start. A good, trustworthy financial adviser can help you understand your options. They can also explain the tax implications of all of those options as well as how your sudden windfall could affect your government age pension and more.

If you want some tips on how to find a financial adviser, look at our article, How to Find a Financial Adviser.

Before you meet with an adviser, though, it’s great to know a few basics for yourself. Let’s have a quick look…

There are different ways you may have received your windfall. It could be a happy event such as willingly selling an investment at a great profit, a surprising event such as winning the lottery, or it could be a distressing or sad event such as the death of a parent, spouse or other loved one.

There will be different aspects to consider, depending on how your money has come to you. There may be differences in taxation depending on your situation. And, of course, there will be differences in your emotional state and differences in the number of other beneficiaries you need to negotiate with to make your decisions in the different situations.


If you have received a bequest or inheritance through someone’s will, it may be cash, but it could also be property, shares and other personal objects.

The relationship you had with the deceased will influence how you manage and what taxes might apply. “Death duties” or “succession taxes” don’t apply in Australia, but tax will still apply to some assets, depending on the type of asset and who receives it. For example, tax will apply to rental income on an inherited investment property and capital gains tax could apply on the sale of an asset. A super benefit may also be taxed, depending on who receives it.

Your relationships will also impact on your decisions about what to do with the assets you’ve been bequeathed. For example, if you are one of a group of adult siblings dealing with their parent’s estate, you will need to negotiate what to do with assets such as the old family home. Some siblings may wish to sell, while others might want to keep it. You may need to bring professional help in if things are complex or it is hard to reach agreement.

If you are the spouse of the deceased, on the other hand, you’re unlikely to need to negotiate about what happens with the shared home you were joint tenants in, for example. But you might need to work out what to do with other assets. You can read more about what may happen to your deceased spouse’s superannuation or Income Stream account on our website.

Selling an investment

Maybe you bought an investment property at a bargain price and you’ve sold it for a great profit. Or maybe you had a share portfolio that you’ve sold off.

If this is you, you’ll need to consider what impact Capital Gains Tax (CGT) will have on your situation. If you’ve made a profit, CGT is likely to apply. One exception is where you bought the asset before 20 September 1985. You should investigate what CGT will be applied to your profit. Read more about CGT on the ATO’s website.

Invest or spend?

If you are the recipient of a large sum of money, however you received it and whatever tax was paid, you will need to make decisions about how and where you wish to spend, save, give or invest it.

First, consider your situation and your own values and priorities. If you are financially comfortable and have no debt, you are in a very different situation to someone who relies solely on the age pension for income and rents their home.

If you are in a situation where the windfall will make a big difference to your life (such as it allows you to outright buy a home for yourself), it may be a quick and easy decision for you!

However, if you are in a more comfortable situation where you own your own home and already have enough to live on in your retirement income portfolio, you will make different decisions.

Your options

There are many options open to you: spend, save, give or invest. All of these options have different risks and rewards. You need to weigh them up for yourself and your situation.

Spending is pretty self-explanatory. You could choose to buy stuff!

Saving could involve putting the money into the bank to keep it for a rainy day. You may also pay off debt, if you have any.

Giving may involve helping your grandchildren or children with a cash payment or buying them something they need. You could also choose to give money to a charity of your choice. If you receive the age pension, you must be aware of the impact the ‘gifting’ could have on your pension. You can read more about this on the Services Australia website or in our article Maximising Your Age Pension.

Investing could be putting money into assets such as shares, an investment property, or investing in something more speculative such as a new business or a passion project. Or you could invest into an ElectricSuper Retirement Income Stream.

Investing in an Income Stream

If you already have an Income Stream, you could open a second one (you will need an opening balance for this second Income Stream of at least $10,000) or you might choose to close your current Income Stream and roll it to a new one with the windfall added to it. To open a new Income Stream, you need at least $30,000.

If you are a lifetime pensioner or you took your super as a lump sum when you retired and don’t have an Income Stream, you could still choose to open a Retirement Income Stream as you are an ElectricSuper member. There is no maximum age limit to opening a Retirement Income Stream.

Depending on your age, you need to take a minimum percentage from your Income Stream in regular payments each year. Once you are over 60 years old, the amounts you take out of your Income Stream will be tax-free. You can read more about how much you need to take on our website

Get more information

We recommend that you speak to a financial planner to discuss your windfall. You may also wish to engage a lawyer or other legal professional to help you, particularly if you have received the money as an inheritance.

You are also welcome to make a free appointment to come in to chat with our Member Services team. We can talk you through the facts of an Income Stream.

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