Retirement
What is the impact of withdrawing your super early?
With over 600,000 members accessing their superannuation early, the challenge shifts to downsizing the potential impact of the policy on the long-term outcomes for members, a consumer group has suggested.

What is the impact of withdrawing your super early?
With over 600,000 members accessing their superannuation early, the challenge shifts to downsizing the potential impact of the policy on the long-term outcomes for members, a consumer group has suggested.

Super Consumers Australia believes members need to weigh up not only their immediate needs but their long-term futures when deciding what is right for them.
Super Consumer Australia’s director, Xavier O’Halloran, said, “When weighing up whether to access your super early, it is a good idea to balance your whole household’s financial needs now and in retirement.”
“Members should also consider the insurance needs, as early access may leave them without enough superannuation to continue paying for insurance premiums in super,” Mr O’Halloran said.
The advocate group highlighted that losses will be cemented if members withdraw, while money spent today will not compound for tomorrow.
“Taking out money before retirement means losing the benefit of compound interest over a lifetime. Depending on how old you are, withdrawing money now could see you having to work much longer to make up the difference before you retire,” he continued.
Impact on retirement
The consumer advocate group highlighted that if a member reduces their superannuation balance today, it means less income in retirement.
The size of the impact is uncertain because it will depend on unknown factors such as the future rate of investment earnings on your super.
Based on the assumption an investor withdraws the full $20,000, The Conexus Institute, Actuaries Institute and Super Consumers Australia have come up with the impact on the member’s retirement.
Current age |
30 |
40 |
50 |
60 |
Reduction in retirement balance |
$50,000 |
$39,000 |
$30,000 |
$24,000 |
Reduction in fortnightly income from superannuation |
$108 |
$83 |
$65 |
$52 |
Reduction in annual income from superannuation |
$2,800 |
$2,200 |
$1,700 |
$1,300 |
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