Wayne Strandquist, president of the Association of Independent Retirees (AIR), has said that “in times of financial crisis such as now, retirees need more flexibility in the minimum amount they are required to draw from their superannuation”.
He acknowledged that retirees who are living off their superannuation “usually have some investments in shares and they have experienced a dramatic fall in their account balances due to the current sharemarket collapse”.
Australian legislation requires retirees to draw a minimum percentage from their superannuation account – usually done monthly.
The association said that being forced to withdraw from their superannuation when the value of the account is substantially diminished will have a long-term impact on how long that superannuation lasts in retirement.
At the present time, it noted that retirees don’t have any option to preserve their account balance by stopping the minimum superannuation drawdown amount.
Mr Strandquist said “the Association of Independent Retirees seeks government intervention to give immediate relief to the current age-based drawdown percentages for account-based pension income streams and allow greater flexibility for retirees to vary the amount they can draw from their superannuation account.”
While the association previously called on the government for greater flexibility by broadening of the age ranges and a lowering of the minimum drawdown percentages, Mr Strandquist said the current investment market crisis has led AIR to seek “immediate options for retirees to lower or cease withdrawals from their superannuation account and resume their usual drawdowns when the investment markets improve”.
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