Super is for retirement – but in some circumstances you might not have to wait.
There are some circumstances where you can access your super before retirement. This includes if you have medical expenses, are in financial hardship, or can’t work due to illness or injury.
To apply to access your super before retirement, you need to apply through your super fund and/or through the Australian Taxation Office (ATO), or you can speak to us.
The main circumstances in which you can apply to get some of your super before retirement include:
Severe financial hardship
You can apply to access some of your super before retirement if you cannot pay reasonable and immediate family living expenses and you receive government income support.
- Before age 60: you can apply to withdraw up to $10,000 of your super. You need to show you have been getting eligible government payments for at least 26 weeks and cannot cover your expenses any other way. You can only access your super for this purpose once a year.
- From age 60: If you’re 60 or over and not employed, you can access your super under the retirement rules.
Your super fund will decide if you’re eligible. You can authorise your fund to check with Services Australia, or ask Services Australia for proof you’re in financial hardship.
Carolyn applies to access her super before retirement
Carolyn had been searching for a job for nine months and had started to fall behind on her rent. She applied to her super fund to access some of her super under the financial hardship rules. On the application form, she authorised her fund to confirm that she was receiving income support from Services Australia and declared that she had no other way of paying her bills. Her fund approved her request and transferred money to her bank account two weeks later.
Compassionate release
You can apply to access super before retirement to pay for specific expenses for you or your dependant if you have no other way to pay.
This includes expenses like:
- medical treatment
- medical transport
- home modifications needed due to disability
- palliative care
- funeral costs
- mortgage payments to stop your home being sold
You’ll need to provide evidence of the cost and show why you can’t pay any other way. You apply for compassionate release through the ATO.
Permanent or temporary incapacity
You may be able to access your super if illness or injury stops you from working.
- Permanent incapacity: this is where you’re unlikely to ever work again in a job you are qualified for by education, training or experience. You may also have insurance you can claim on.
- Temporary incapacity: if you have income protection insurance in your super account you may be able to make a claim if you’re unable to work for a period of time due to illness or injury. This will depend on the insurance you have and the conditions.
Check with your super fund, or speak to us about any insurance you hold, the claim process, and the medical information required.
Terminal illness or injury
You can apply to access your super before retirement if two doctors – one of them a specialist in the area related to your medical condition – certify you have an illness or injury that means you’re expected to live for less than 24 months.
If you have insurance in your super account, you may also be able to make an insurance claim at the same time.
Each fund has its own process and forms for this. Contact your fund for details.
Other ways to access super before retirement
There are other ways to access your super before retirement.
These include:
- The First Home Super Saver Scheme: this helps you save for a deposit to buy your first home by putting extra contributions into super and then withdrawing these contributions.
- Temporary residents: if you worked in Australia on a temporary visa, you can usually claim your super when you leave Australia.
- Small balances: if the balance of your super fund account is less than $200 and you lose your job, or if you find a lost super account with a balance less than $200.
Smart Tip: If you’re thinking about leaving a defined benefit fund, get professional advice. Some funds are very generous, so make sure you’ll be better off. If you leave, you can’t rejoin.
Key actions you can take
- Consider which early-access option applies to your situation
- Read the ATO rules for that option before you apply
- Get the information ready that your super fund and/or the ATO will need
- Apply only through the ATO and/or your super fund
- Ask lots of questions if you’re unsure about your eligibility or the process
Source:
Reproduced with the permission of ASIC’s MoneySmart Team. This article was originally published at https://moneysmart.gov.au/how-super-works/when-you-can-access-your-super-early
Important note: This provides general information and hasn’t taken your circumstances into account. It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, we do not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, we do not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person. Past performance is not a reliable guide to future returns.
Important
Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business nor our Licensee takes any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) accessible from this page.
