When you Need to Get your Money Early: How to Access your Super Earlier than Planned

Many Australians for one reason or another want early access to their super benefits. It could either be because they’re reaching retirement age, found a need to utilize the money or are going through a financial rough patch. No matter the reason we’re looking at how to access the money so that it can be used.

Withdrawing superannuation benefits doesn’t come without its own set of super rules. For the most part the basic rules are age, but if you’re not willing to wait that long there are certain ways to get around that. Let’s take a look at traditional methods and other ways of getting the money out of the fund.

Factors to Take into Account

For the most part, you won’t be able to withdraw anything from your superannuation until you reach what’s called the preservation age and retire. For those born before July of 1960 that’s 55 years old and up to 60 if born after June of 1960.

Age is a large defining factor of all of this, but there are other things to take into consideration as well. This will include employment status, financial standing, family deaths, illness and certain medical conditions. Knowing whether or not you actually need to get your money out early is important to know. Nationwide Super offers guides and financial planning to save you time and money. It’s good to keep updated on your finances to best utilize the money you’re receiving or going to receive.

Retirement Age

Different ages account for different benefits and regulations that can be received from your super fund. Once you’ve reached retirement age you can take and start receiving money from the fund. From the ages of 60 to 64 people who have ceased employment are considered retired. If continuing employment after that age is done, then that’s not up to terms of release of the funds.

Once the age of 65 has been reached, the entire sum can be paid out and released, even if you’re still in the workforce. For a lot of people who enjoy working and want to keep doing so for whatever personal or financial reason, accessing the superfund at this time is beneficial.

Financial Hardships

If you’re on especially hard times, there are ways to get some of the superannuation money back. That is if you fit certain preset conditions. Severe financial hardship is defined in a specific way from the government’s point of view. Here are some of the rules that need to be taken into account in order to satisfy the requirements. The first one is that you have been receiving Commonwealth Government income support. That means you’re using unemployment benefits and have been doing so for at least 26 weeks continuously. This means that any superannuation payment is for the purpose of everyday living and can’t exceed a payment of $10,000 to take.

Another example goes back to preservation age that means you can receive the entirety of the fund if you reach the age from 55 to 60, and have been on government income support for the last 39 weeks.

Accessing the Money

There’s the possibility to enter into something called a transition-to-retirement pension (TRIP). Once you’ve reached the preservation age of 55, there’s the ability to receive and withdraw 10 percent of the account balance as pension payments each subsequent year until retirement. There’s no way to take it out as a lump sum, but this is a great way to access some early funds.

If your preserved amount of super benefits was less than $200 if your employer was contributing to your fund and you left the job, you’re entitled to a very small amount. Under certain conditions you can have unrestricted access if you were a member of a super fund before July 1st 1999 and you can cash in what’s called a “restricted non-preserved benefit.”

Overview of Other Circumstances

There’s the ability to have some funds or all funds released if you’re suffering a deadly illness that’s life threatening or if again financial hardships are too much to bear, such as a foreclosure or something similar. On top of this if you’re in a terminal illness or there’s been a death then your fund will go to relatives or a spouse’s will go to yours.

Accessing the super fund can be done through a lot of methods and has various rules for each. If you meet any of these criteria or think you might, there’s no harm in asking the rules and regulations for your current situation.

About the Author
Elizabeth Swift works as a personal finance consultant. Her articles appear on a selection of personal finance sites online and offline.