Get super early with these steps
Jobless people are rushing to access their savings early, writes Sophie Elsworth
UNEMPLOYED pastry chef Dulcy Semu is among the hundreds of thousands of cash-strapped people rushing to access their super early.
From today, Australians can get some of their retirement savings prematurely if they have lost their job or had a significant drop in their income.
Ms Semu, 45, who is originally from New Zealand, was recently put out of work and now has limited access to funds.
She has about $18,000 in superannuation and said, with little cash savings, tapping in to super was her only hope to get money quickly.
As a New Zealand citizen she did not meet the Centrelink eligibility requirements to receive welfare payments, Ms Semu said.
“Accessing super is a lifeline,” she said. “I basically have no money and it’s a last resort – I have a credit card debt, too.
“I was planning on moving back to
New Zealand a few weeks ago but my flights were cancelled so I’ve opted to stay in Australia.”
Under new rules introduced by the Morrison Government, eligible employees who are in financial turmoil are able to access their super early because of the financial fallout from COVID-19.
The scheme allows applicants to access $10,000 in super savings tax-free this financial year and another $10,000 next financial year (from July 1).
Intrust Super chief executive officer Brendan O’Farrell said while early access to super provided “critical relief”, it would have a “significantly negative impact” on a person’s future wealth.
“A 25-year-old could end up $130,000 behind after withdrawing $20,000 today, not to mention possible loss of insurance cover which, in some cases, can only be regained through underwriting that may lead to additional exclusions or loadings,” Mr O’Farrell said.
“The system could also be clogged by some individuals making unnecessary claims given the minimal self-assessment criteria.”
Already more than more than 617,000 Australians have registered their interest to access super early and applications can be accepted through myGov.
Industry sources say it could also take between three to five days for funds to be transferred after an application is lodged. Australian Institute of Superannuation Trustees head of advocacy Melissa Birks urged anyone accessing super early to only do so as a “last resort” after exhausting all other Government income-support measures.