Retirement
Almost half a million Australians empty their retirement fund
Almost half a million Australians have completely emptied their superannuation savings under the government early access to super scheme, new research has found.
Almost half a million Australians empty their retirement fund
Almost half a million Australians have completely emptied their superannuation savings under the government early access to super scheme, new research has found.
According to Industry Super Australia (ISA), 480,000 Australians have taken all their superannuation out, with over 395,000 of them being under the age of 35.
The numbers released are before 1 July, when eligible members are entitled to release a second $10,000 from their retirement fund.
Industry Super Australia chief executive Bernie Dean believes this will have a major impact on Australians long-term retirement goals.
“To have hundreds of thousands wiping their savings out midway through their life is a tragedy waiting to happen and it will affect everyone. Every Australian deserves a good life in retirement, not just scraping by on the pension.”
The ISA noted a 25-year-old taking out $10,000 now could have $49,000 less in retirement, while a 35-year-old could lose up to $34,000 and a 45-year-old up to $23,000.
On average, about 15 per cent of Australian workers have accessed their super early. Three states were above the national average – Queensland at 20 per cent, Northern Territory 19 per cent and Western Australia 16 per cent. Only 8 per cent of ACT workers accessed their super early.
The government estimated 1.65 million would take out $27 billion from super, but already 2.1 million have taken out at least $15 billion and it appears likely demand will far surpass forecasts. Despite the greater numbers, industry funds have prepared to deal with the demands of this scheme.
Industry funds have paid more than $10.3 billion from super, 96 per cent of it within five business days of receiving the request from the ATO.
Mr Dean said industry funds have supported this scheme’s intent to get cash to those in dire financial need. They have already helped more than 1.4 million Australians tap into their super.
However, he noted that “troubling reports of super being used to gamble, buy alcohol or other types of discretionary spending”.
Mr Dean said the superannuation rate must be raised to 12 per cent, as previously stated by the government in order to get members back on the right track.
“The Prime Minister and Treasurer must stick by their promise to increase the super rate because its critical to helping these people rebuild savings they’ve wiped out, and avoid tax hikes on working people to prop up more people drawing a full pension,” Mr Dean concluded.
Did you enjoy this article? You may also be interested in:
- How to rebuild your super balance after COVID-19
- Fast-forward to 2050: 1 in 2 retirees will be 'comfortable'
- Industry super slams government over guarantee freeze
RELATED ARTICLES
About the author
About the author
Superannuation
Election policies could reshape Australia's superannuation landscape, expert warns
Competing superannuation policies from Australia's major political parties could have significant implications for investors and retirees, according to a financial expert. Read more
Superannuation
Industry leaders weigh in on concessional super tax as Budget confirms $55bn investment
Changes to the taxation of superannuation earnings and contributions have drawn mixed responses from financial and payroll sector leaders, as the Federal Budget confirms over $55 billion in ...Read more
Superannuation
Call for indexation on super tax cap as $3m threshold draws criticism
A senior executive in the superannuation technology sector has criticised the Federal Government for failing to index the proposed $3 million superannuation tax cap, arguing the measure will unfairly ...Read more
Superannuation
Rest members back calls for fairer superannuation rules ahead of Federal Budget
Rest has called on the Federal Government to implement superannuation reforms aimed at improving fairness across the system, after member survey results showed strong support for a range of proposed ...Read more
Superannuation
Rest welcomes progress on ‘Payday Super’ reform
Rest, one of Australia’s largest profit-to-member superannuation funds, has welcomed the Australian Government’s release of draft ‘Payday Super’ legislation, which aims to align Superannuation ...Read more
Superannuation
SuperAPI and Humanforce partner to improve superannuation compliance for one million Australians
Superannuation engagement platform SuperAPI has partnered with human capital management provider Humanforce to streamline payroll and superannuation contributions for more than one million Australian ...Read more
Superannuation
Rest super fund reports 11.19 per cent return for 2024
Rest superannuation fund delivered an 11.19 per cent return in its MySuper Growth investment option for calendar year 2024, marking two consecutive years of positive returns. Read more
Superannuation
Actuaries propose three-tier superannuation tax reform
The Actuaries Institute has outlined major reforms to Australia's $4.1 trillion superannuation system, proposing uniform tax rates and new levies on high retirement withdrawals. Read more
Superannuation
Election policies could reshape Australia's superannuation landscape, expert warns
Competing superannuation policies from Australia's major political parties could have significant implications for investors and retirees, according to a financial expert. Read more
Superannuation
Industry leaders weigh in on concessional super tax as Budget confirms $55bn investment
Changes to the taxation of superannuation earnings and contributions have drawn mixed responses from financial and payroll sector leaders, as the Federal Budget confirms over $55 billion in ...Read more
Superannuation
Call for indexation on super tax cap as $3m threshold draws criticism
A senior executive in the superannuation technology sector has criticised the Federal Government for failing to index the proposed $3 million superannuation tax cap, arguing the measure will unfairly ...Read more
Superannuation
Rest members back calls for fairer superannuation rules ahead of Federal Budget
Rest has called on the Federal Government to implement superannuation reforms aimed at improving fairness across the system, after member survey results showed strong support for a range of proposed ...Read more
Superannuation
Rest welcomes progress on ‘Payday Super’ reform
Rest, one of Australia’s largest profit-to-member superannuation funds, has welcomed the Australian Government’s release of draft ‘Payday Super’ legislation, which aims to align Superannuation ...Read more
Superannuation
SuperAPI and Humanforce partner to improve superannuation compliance for one million Australians
Superannuation engagement platform SuperAPI has partnered with human capital management provider Humanforce to streamline payroll and superannuation contributions for more than one million Australian ...Read more
Superannuation
Rest super fund reports 11.19 per cent return for 2024
Rest superannuation fund delivered an 11.19 per cent return in its MySuper Growth investment option for calendar year 2024, marking two consecutive years of positive returns. Read more
Superannuation
Actuaries propose three-tier superannuation tax reform
The Actuaries Institute has outlined major reforms to Australia's $4.1 trillion superannuation system, proposing uniform tax rates and new levies on high retirement withdrawals. Read more
