This weeks question is another common query; can you withdraw the money in your superannuation early?
This seems to be one of the first 'solutions' to pop into the mind of a lot of people when really it should be considered only as a last resort.
By law, you generally get your super only when you:
- permanently retire from the workforce, and also
- reach the minimum age set by law, called your 'preservation age' (this is typically between 55 and 60 depending when you were born).
- permanently retire from the workforce, and also
- reach the minimum age set by law, called your 'preservation age' (this is typically between 55 and 60 depending when you were born).
You can get your super earlier only if you:
- suffer permanent incapacity for work, or
- possibly in cases of severe financial hardship, or
- on 'compassionate grounds'.
- suffer permanent incapacity for work, or
- possibly in cases of severe financial hardship, or
- on 'compassionate grounds'.
Contact your fund. If the rules allow early release of benefits, you must satisfy the trustee that you have been receiving a Commonwealth income support payment for a continuous period of 26 weeks and you cannot meet your reasonable and immediate family living expenses.
Contact your fund. If the rules allow early release of benefits, the 'compassionate grounds' are set out in the law. The Australian Prudential Regulation Authority (APRA) must consider your application first, before your fund trustee can make a final decision.
Compassionate grounds involve medical treatment for serious conditions that is not readily available through the public health system, transport for medical treatment, changes to a home or vehicle because of a severe disability, palliative care, funeral and burial expenses, or to prevent the forced sale of your home by your mortgagee.
Avoid illegal schemes that try to get your super money out early, and save yourself from getting cheated and from heavy tax and legal penalties. These schemes are sometimes promoted by word of mouth or shady advertising.
Report to ASIC or the Australian Tax Office (ATO) anyone who tries to talk you into getting your preserved benefits early through a self-managed super fund or for a fee. AVOID THESE SCAMS and do not risk your money.
Source: Information for this response has been sourced from the Australian Securities and Investments Commission.
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