How to access your superannuation
Key takeaways:
- When can I access my super
- How can I access part of my super
- How can I access all of my super
Preservation age (the earliest point) Australian preservation ages refer to the age at which you can access your superannuation (retirement savings) without any restrictions or penalties. The preservation age varies depending on when you were born, with those born before 1960 having a preservation age of 55 and those born after 1974 having a preservation age of 60. For those born between 1960 and 1974, the preservation age gradually increases from 56 to 60 years old. It’s the age you need to be able to access your retirement savings without being penalised.
Transition to retirement (accessing part of your super The Australian transition to retirement (TTR) strategy is a way for individuals who have reached their preservation age to access their superannuation while still working. It involves using a portion of your superannuation to provide an income stream, while you continue to work and contribute to your superannuation account. The main purpose of the TTR strategy is to allow individuals to gradually reduce their working hours or job responsibilities without reducing their income, by using some of their superannuation savings to supplement their salary. This can be especially beneficial for those approaching retirement age who want to ease into retirement gradually, or for those who want to maintain their standard of living while reducing their work commitments.
Account-based pensions (Accessing all of your super with no restrictions) An Australian account-based pension (ABP) is a retirement income stream that is paid out of an individual’s superannuation account. It provides a regular income for retirees to supplement their retirement savings, allowing them to maintain their standard of living in retirement.
With an ABP, a lump sum of money is taken from the individual’s superannuation account and invested in a pension account. The money in the pension account is then used to pay the retiree regular payments, which can be customized to suit their needs. The payments can be made monthly, quarterly, or annually, and can be adjusted according to inflation or other factors. The amount of income paid out by an ABP is determined by several factors, including the amount of money in the pension account, the investment returns on the account, and the age and life expectancy of the retiree. One of the advantages of an ABP is that it provides flexibility in terms of how much income is received and when. It also allows retirees to access their savings tax-free once they reach the age of 60.
However, it’s important to note that there are rules and regulations governing ABPs, and it’s important to seek professional financial advice before making any decisions about your retirement savings.
If you would like to learn more about how to access your super, please feel free to speak to a financial planner or financial advisor who services the Yarraville, Williamstown, Seddon, Kingsville and West Footscray areas.
