There are certain life situations where you might find yourself needing to be able access your superannuation before you reach retirement age. You may be unable to work because of an injury, perhaps you are thinking of buying your first home or maybe you have compassionate grounds such as the funeral for a dependent - this article explains those circumstances when you can withdraw superannuation early.
Normally, to access your superannuation, you are required to have attained the preservation age. This is the age you can access your superannuation when you retire or have commenced the transition to retirement.
Your preservation age depends on when you are born.
- If you were born before 1 July 1960 your preservation age is 55 years;
- If you were born on and between 1 July 1960 - 30 June 1961 your preservation age is 56 years;
- If you were born on and between 1 July 1961 - 30 June 1962 your preservation age is 57 years;
- If you were born on and between 1 July 1962 - 30 June 1963 your preservation age is 58 years;
- If you were born on and between 1 July 1963 - 30 June 1964 your preservation age is 59 years;
- If you were born on and from 1 July 1964 your preservation age is 60 years.
Even if you have not reached preservation age, there are certain life circumstances where you can access your superannuation early. You will need to contact your superannuation fund to ask what documents you are required to provide to access the funds but some situations can include:
- A compassionate reason;
- A first home deposit;
- The diagnosis of a terminal medical condition
- Being unable to go to work due to injury or illness.
A superannuation fund will consider the early release of funds for compassionate reasons for certain life events that include things like needing to pay for medical treatment for you or your dependent, to pay for palliative care or being able to pay for a funeral of your dependent.
First Home deposit
The Australian Government formed the First Home Super Saver Scheme to assist Australians to save the deposit for their first home. You can withdraw up to $30,000 of voluntary contribution made after 1 July 2017 from your superannuation account to assist you to buy your first home.
Terminal medical condition
You can make a claim to access your superannuation early if you receive a terminal medical diagnosis. You are required to provide medical documents from your treating doctors, including your specialist that certify that you suffer from a condition that is likely to result in your death within 24 months.
Being unable to work due to injury or illness
If you have sustained an injury or suffer an illness, you may be entitled to bring a claim for total and permanent disability (TPD) because of a permanent impairment. A claim can be made if you have suffered an injury or illness that permanently prevents you from working in your normal job or being able to undertake any other work to which you are suited by your education, training, or experience. The injury or illness does not need to be related to your work and can be for several reasons, for example, a cancer diagnosis, an injury you sustained at home or playing sport or a chronic illness diagnosis.
Most superannuation funds include a TPD benefit, and the benefit amount will vary depending on the policy negotiated by your superannuation fund or employer. Benefits are usually worth in the vicinity of tens or hundreds of thousands of dollars and it is important to make an application as soon as you consider you might have the entitlement. Some funds will allow for a payment for permanent impairment despite you failing to meet the definition of TPD under their policy.
To start the process of accessing your superannuation early you will be required to contact your fund directly to confirm what cover you have under your policy and to also find out what documents are required by the fund to consider your request. You can contact us at Carroll & O'Dea Lawyers in circumstances where you think you might have an entitlement to accessing your superannuation because of an injury or an illness, and one of our lawyers can assist you.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.