Defensive wealth building: annuities & investment bonds

Create guaranteed income streams and tax-effective wealth transfer structures using modern annuities and investment bonds.

Annuities and investment bonds

Certainty in an uncertain world.

If you worry about the stock market crashing or interest rates falling, you might prefer an investment that offers a guarantee.

At Sunlit Path, we use these tools to create “safety floors” for your income, ensuring that your essential lifestyle costs like rates, power, and food are covered no matter what happens in the world.

Lifetime annuities: a "paycheck for life"

A Lifetime Annuity is a simple exchange, you provide a lump sum of capital, and in return, a provider gives you a guaranteed series of regular payments that last for the rest of your life, regardless of how long you live.

Income You Can’t Outlive: The provider is legally obligated to pay you until death, even if your original investment has been fully paid back. This solves the “Longevity Risk”, the fear of outliving your savings.
The Centrelink “Asset Discount”: Under current 2026 rules, annuities are a powerful way to boost your Age Pension. Only 60% of the purchase price counts as an asset for the Centrelink test. Once you reach “Threshold Day” (typically age 85), this drops even further to only 30%.
Market Insulation: Your income remains stable during economic downturns, providing psychological safety to stay invested in other areas for growth.
Inflation Protection: We often recommend “indexed” options where your payments increase annually in line with the Consumer Price Index (CPI), so your purchasing power stays the same as prices rise.

Investment bonds: flexibility outside of super

Investment Bonds are “tax-paid” investments designed to provide flexibility for those who have already maxed out their super or want to save for specific family goals.

The “10-Year Rule”: If you hold the bond for 10 years, all withdrawals (including every dollar of profit) are completely tax-free in your hands.
30% Tax Cap: Earnings are taxed internally at 30%. This is highly effective for high-income “Everyday Achievers” whose personal tax rate is 37% or 45%.
Estate Planning Power: You can nominate beneficiaries to receive the proceeds directly and tax-free upon your death, bypassing your Will and reducing the risk of family disputes.
No “Preservation Age”: Unlike super, you can access your money at any time, though withdrawing before year 10 may reduce your tax benefits.

Funeral bonds: peace of mind for your family

A Funeral Bond is a specialised version of an investment bond designed solely to cover future funeral expenses.

- Centrelink Asset Exemption: For the 2025/26 financial year, you can invest up to $15,750 and have it be completely exempt from the Age Pension assets and income tests.
- Couple’s Strategy: A couple can each have an individual bond, effectively shielding $31,500 from Centrelink to help maximise their pension.
- Restricted Access: The money is “locked” and only released to your estate or funeral director to pay for your service.
- No Health Checks: Unlike funeral insurance, there are no medical questions or rising premiums. You are simply setting aside your own money in a tax-effective way.