A guide to accessing your superannuation before retirement

Generally speaking, you cannot access your superannuation until you reach the minimum age set by law (known as the preservation age), and you permanently retire from the workforce. However, there are some specific circumstances in which it will be possible for you to receive your superannuation claim before your retirement.

1. Specify your grounds to apply for the early release of your superannuation

You can apply for your superannuation to be released early on specified compassionate grounds or if you are experiencing severe financial hardship.

Specified compassionate grounds
You can be provided with early access to your superannuation if one or more of these specified compassionate grounds apply to you;

● the amount will be used to pay for medical or dental treatment for yourself or a dependant
● the amount will be used to modify your home or vehicle to accommodate a severe disability
● the amount will be used to pay for palliative care for yourself or a dependant.
● the amount will be used to pay for expenses associated with a dependant’s death, funeral or burial

The Department of Human Services (DHS) makes decisions on the release of super on compassionate grounds, so it is important to contact the department in order to see if you may be eligible for early release.

Severe financial hardship
The definition of ‘severe financial hardship’ is very specific, and you must prove that you satisfy the following requirements to access your super benefits early because of this hardship.

● you have been receiving certain Centrelink allowances for at least 26 weeks continuously. For those who are over 55 and have not yet retired, this is increased to 39 weeks.
● you have insufficient money to meet your ‘reasonable and immediate’ living expenses.

You should apply directly to your superannuation fund for early release of funds, on the grounds of severe financial hardship. In these cases, if your superannuation fund agrees to release your superannuation early, you may receive a lump sum payment of up to $10,000 for a one-off financial problem. This does not include the payment of day to day expenses or bills that are not immediately due.

Accessing your superannuation early in this situation should only be considered after other debt management options have been considered and the advice of a financial advisor has been sought. It is also important to note that a superannuation fund is not obliged to release your superannuation funds early if their policy disallows early access.

2. Collect the relevant supporting documentation

In order to access your superannuation before retirement on one of the aforementioned grounds, it is important to collect the relevant supporting documents to prove either the compassionate grounds upon which you are making your claim or the financial hardship upon which you make your claim. For compassionate grounds, the relevant supporting documents will likely include medical examinations. For financial hardship grounds, your superannuation fund will likely require clear evidence of your debts, displaying a clear inability for you to meet your reasonable and immediate living expenses. Most claims can be assessed online once the relevant supporting documentation has been received.

3. Consider the advantages and disadvantages of accessing your super before retirement

Obtaining access to your superannuation funds early means in situations of financial hardship that you are able to use your own funds to manage your debt, rather than taking out additional loans. In circumstances involving compassionate release, it means that if you see your current need as greater than your future needs as a result of terminal illness, then you can ease your financial burden using your earned superannuation.

It is important to note though the disadvantages that are involved in releasing all or part of your superannuation before retirement. The include the fact that funds released prior to retirement are taxed at a higher rate, and that your superannuation fund may charge a service fee and other costs for allowing the funds to be available early.

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