Why are a record number of Aussies accessing super early?
<p>More and more applications to access superannuation early are being approved, and Australians in financial hardship are walking away with more cash than ever before.</p>
<p>Those facing mortgage defaults, terminal illness or being permanently incapacitated are being approved to dig into their retirement savings early.</p>
<p>In the first 10 months of the 2014-15 financial year 73 per cent of applications for the early released of super were approved. In comparison, 63 per cent were approved in 2013-14, according to figures released by the Department of Human Services.</p>
<p>Additionally, the average amount being accessed has risen from $12,300 to $12,600.</p>
<p>This financial year more than 16,000 applications were made with around 11,700 approved. The total amount released was $148 million.</p>
<p>The Australian Institute of Superannuation Trustees chief executive officer Tom Garcia said that despite the rising approval rates for early release of super, there are still strict rules enforced to access super before preservation age.</p>
<p>“It’s important to understand that early release is limited to certain purposes and financial amounts – strict criteria applies to make sure the decision is in the member’s long term best interests,” he said.</p>
<p>“Recent budget announcements will make the system more accommodating for people diagnosed with terminal illness to successfully apply for early access to their super due to an extension of the life expectancy period from 12 to 24 months.”</p>
<p>Financial Counselling Australia’s executive director Fiona Guthrie warned that accessing super should be carefully thought through.</p>
<p>“It depends on the person’s circumstances… it may lead them to be worse off,” she said.</p>
<p>“They may have lost access to their funds meant to be used for retirement, you should get some advice and think it through clearly.” </p>
<p><strong>Related links: </strong></p>
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<p><em><span style="text-decoration: underline;"><strong><a href="/finance/retirement-income/2015/08/best-super-returns/">Is your super fund performing as best it can for you?</a></strong></span></em></p>
<p><em><span style="text-decoration: underline;"><strong><a href="/finance/retirement-income/2015/07/understanding-super-fees/">Understanding super fees</a></strong></span></em></p>
