Retire Right 407 Bucket strategies, market crashes, super risk levels & does property beat super in retirement?
Feb 11, 2026
Martin McGrath, financial adviser at Financial Edge Group who specialises in retirement and super, breaks down practical retirement mechanics. He explains the three-bucket strategy and how funds move between them. He walks through treating defined benefit pensions within a bucket plan. He clarifies crash/correction/bear market terms and compares safety and diversification of super versus property.
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Three-Bucket Retirement Structure
- Set up three buckets inside your super: cash, fixed interest, and growth to fund retirement withdrawals.
- Use the cash bucket for the first year's spending and fixed interest for the next 3–5 years to avoid selling growth assets in a downturn.
Platform Choice Affects Bucket Automation
- Industry funds often don't automatically route income into a cash option, so buckets may require manual rebalancing.
- Wrap/IDPS accounts give more automation and flexibility but may cost slightly more in fees.
Net Defined Benefit From Spending Need
- When you have a defined benefit (DB) pension, net it off expected spending before sizing buckets.
- Reduce your bucket needs by the guaranteed DB amount and personalise the remaining bucket sizes to risk tolerance.