Super withdrawal: Last chance to withdraw your superannuation under COVID-19 rules

Cash-strapped Aussies have just four days left to access their superannuation early, with the scheme set to fall billions short of expected withdrawals.

EXCLUSIVE

CASH-strapped Australians have just four days left to access their superannuation early and the scheme will fall billions short of expected withdrawals.

The Federal Government’s early access to super scheme has seen more than 3.03 million individuals withdraw $37.6 billion of their own money.

It was forecast more than $42 billion would be withdrawn before the scheme finishes on December 31.

On average 18,400 applications have been received each day since the scheme began in April.

But The Australian Taxation Office’s assistant commissioner Sonia Corsini warned Australians who plan to withdraw up to $10,000 this week to take care in submitting their application.

“Applying online via myGov is easy and quick but don’t rush,” she said.

“Double-check all your details as any mistakes will delay your application.”

She said it usually takes four business days for the ATO to process applications and from there it takes another five business days to deposit money in bank accounts.

Marketing manager Chloe Hirzel, 32, and her husband, Thomas, 34, who works as a sales consultant, both suffered income hits during the pandemic.

Chloe Hirzel, 32, and her husband Thomas Hirzel, 34, and Eva, 18 months, both accessed their superannuation early under the Federal Government's scheme. Picture: Jake Nowakowski

The pair from Mornington south of Melbourne withdrew $30,000 all up.

“I wasn’t working and my husband had his hours cut, I saw a big downturn in my superannuation balance,” Mrs Hirzel said.

“Super goes up and down but we don’t want to rely on super in the future, we’ve moved into a new property and it's probably going to allow us to renovate and put the money towards an investment property.”

Minister for Superannuation, Financial Services and the Digital Economy Senator Jane Hume said the scheme has been a “lifeline for millions of Australian families doing it tough during the pandemic”.

“For many being able to withdraw a chunk of their own money has let them pay down mortgages and credit cards and cover household bills,” she said.

Eligible applicants could access up to $10,000 last financial year and another $10,000 through to December 31.

But Industry Super Australia’s chief executive officer Bernie Dean said anyone tapping into their super should only do it as "last resort”.

“There is other financial support available from the government such as JobKeeper and JobSeeker and they should be looking at those first,” he said.

The government’s Moneysmart calculations found for a 30-year-old withdrawing $10,000, would equate to a loss of $21,516 in today’s dollars come retirement at age 67.

It bases figures on a person with an annual income of $50,000 whose annual investment returns are 7.5 per cent.

While for a 50-year-old it would result in a loss of $14,253 come retirement.

HOW TO ACCESS SUPER EARLY

• Check your super balance online to check you have sufficient funds.

• Make sure you are eligible. This includes being made redundant in 2020, receiving Jobseeker or you’ve had your working hours reduced by 20 per cent or more.

• Temporary residents are not eligible to apply in the 2020-21 financial year.

• Ensure your bank details, which the ATO & your super fund have, are up to date.

• Visit the myGov website, then click on the ATO portal.

• Click on the COVID-19 measures.

• Go to the early release of superannuation and click on ‘apply’.

• An outcome letter will be sent to your myGov inbox and you may also receive an SMS notification.

• All applications close on December 31.

@sophieelsworth

Originally published as Super withdrawal: Last chance to withdraw your superannuation under COVID-19 rules