For years we are working hard knowing that the day we retire, there is a great pool of funds that will become available to us named superannuation
that has been building over the years with our employer contributions and our additional personal contributions when we could afford it.
And then the day comes when we need to fall back on our super, we need either to withdraw a portion or the full balance
or commence a form of a retirement income stream to provide for our ongoing living expenses.
Or maybe you would like to commence a Transition to Retirement Pension - watch this video that will explain TTR income option:
"Can I access my super and continue working - Transition to Retirement".
But often it appears to be a very confusing topic to know when you can actually have access to your superannuation savings.
At what age, or in what situation you are able to do anything you wish with your superannuation funds?
I have already created a video: "When can I access my super, please?" and today we will continue this topic from the preservation rules perspective.
Superannuation is not like your savings in bank account or even any type of investment portfolio.
Any money outside of the superannuation environment you have full control over, with superannuation savings, not so much.
You have to follow all superannuation rules and you have to comply with superannuation legislation.
So today I will discuss the rules you have to meet in order to have access to your super savings.
I will explain preservation rules and your preservation age.
My name is Katherine Isbrandt from About Retirement, I am Certified financial Planner and you are watching About Retirement TV,
the place where you can learn all you need to know to improve your pre-retirement phase of your life, as well as if you have already retired.
When talking about access to your superannuation savings, the first thing to understand and comply with are preservation rules.
Preservation rules are to prevent you from having access to your superannuation savings before you satisfy conditions of release.
1. Preservation rules
Within your superannuation fund there are number of different benefits pool of funds that was contributed to your superannuation fund in a different period in the past:
1. preserved benefit - those are all contributions made and all earning after 30 June 1999 - this benefit will only be paid out to you when you meet conditions of release.
2. restricted non-preserved benefit - contributions made between 1 July 1983 up until 30 June 1999 - to access this benefit you also have to meet conditions of release
3. unrestricted non-preserved benefit - that portion of superannuation savings you can access at any time if your superannuation fund's rules allow it.
Please check your superannuation fund statement, you will most likely see that majority of your super savings consist of preserved benefit
If this is the case, you have no choice but to wait for the time when you meet conditions of release to have access to your superannuation savings.
I will create a separate video explaining conditions of release in details, however one of the main conditions of release is meeting your preservation age
Sometimes it is not enough to just reach your preservation age, there could be other conditions that you have to meet at the same time,
but most certainly this is one of condition that is most likely required if you wish to access your superannuation savings as early as possible.
2. Preservation age
If you wish to have access to your super savings as early as possible, because you just don't really want to continue working any longer
then you really need to understand what preservation age is and figure out when you are meeting yours.
So if you reach your preservation age and you additionally meet conditions of release, this will provide you
with your earliest possible timing to access to your superannuation benefits.
Your preservation age depends on the date of your birth, and it works as per table:
If you were born before 1st July 1960 your preservation age is 55
If you were born between 1st July 1960 and 30th June 61 your preservation age is 56.
If you were born between 1st July 61 and 30th June 1962 your preservation age is 57.
If you were born between 1st July 1962 and 30th June 1963 your preservation age is 58.
If you were born between 1st July 1963 and 30th June 1964 your preservation age is 59.
and if you were born after 1st July 1964 your preservation age is 60.
To make it really easy for you, if you were born before 1st January 1964,
you have already reached your preservation age, therefore you met half of the conditions of release.
Therefore now, all you have to do is to meet the rest of the requirements of conditions of release, which as I mentioned before
I will explain in separate video, as it is a long explanation in its own right.
And one more important information, your preservation age is different to your Age Pension eligibility age.
So just as a reminder, on 1st July 2021, the Age Pension age was increased from 66 years to 66.5.
Therefore, if you were born between 1 July 1955 and 31 December 1956, you have to get to the age of 66.5 to be eligible for Age Pension.
From 1st July 2023, the Age Pension age is rising to 67 for those people who are born after 31 December 1956.
but please don't forget that you can apply for Age Pension 13 weeks before you actually reach your eligility age.
but obviously that is providing that you know in advance that you will pass Income and Assets Tests
If not, or if you calculate it that you might only get a very small part of Age Pension,
please speak with a financial planner and receive the full advice how to maximize your Age Pension benefit.
I hope you learned something new today, if yes, please give this video a THUMBS UP and SUBSCRIBE to my channel not to miss any of my future videos.
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If on the other hand you need a chat to see how you are doing, whether you can improve your financial set up or your outcomes,
or if you would like to actually receive the full financial advice, just organise a meeting for us at the time that suits you
On each page of my website there is a button: BOOK A MEETING that will take you to my personal calendar where you can choose the day and time of our meeting.
And now, please keep on watching and learning. the first recommendation is: "When can I access my super, please?"
the second recommendation is: "Extra new tax in super" - from what I can gather a very controversial topic indeed.
I will speak with you in my next video, bye for now.