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When can I access my super?
In most cases you can’t withdraw your superannuation until you reach your preservation age and retire.
Preservation simply means locked away until you reach a certain age and retire, or satisfy another condition of release.
Preservation age is 55 for those born before July 1960, and ranges from age 56 to 60 years, depending on date of birth, for those born after 1 July 1960.
Retirement is the most common condition of release. You can access your super when you have reached your preservation age AND retire from the work force.
As soon as you reach the age of 65, you can withdraw any or some of your superannuation benefit (if you wish), even when you haven’t retired from the workforce, this is known as a condition of release without restrictions.
You can access a portion of your benefit each year by starting a super pension without retiring, provided that you’ve reached your preservation age and you withdraw no more than 10 per cent of your account balance as a pension payment/s each year. This is known as a transition to retirement pension. There may be some tax advantages to this, depending on your individual situation and age.
You may be able access some of your super funds if you satisfy the special conditions that constitute the government’s view of ‘severe financial hardship’.
You must have been receiving Commonwealth Government income support continuously, and the trustee of your super fund is satisfied that you can’t meet immediate reasonable family expenses. There are conditions on the amount you can receive.
Before you retire, your super fund can release, part or all of your preserved benefits if you’re suffering a life-threatening illness, or are trying to prevent the bank selling your home, pay for funeral or medical expenses, or palliative care. Do you know anyone in this situation? Let them know, there is something they can do at such a difficult time.
If you suffer a terminal medical condition as defined by the super laws, you will be able to access your super benefits early. Clients with a terminal medical condition who withdraw superannuation lump sums while under age 60 are not subject to tax on that lump sum. Conditions do apply.
There are other reasons and rules for conditions of release which will be discussed in future blogs. These include but are not limited to permanent or temporary incapacity and death.
As you can see, the rules are many and the conditions are complex. Financial advice from a qualified financial adviser is recommended and helpful.
Contact Katherine Hann on 08 8299 9927 to determine if you meet a condition of release and how to make the best use of your super funds for your own individual situation.