Tens of thousands Australians are trying to access their superannuation early

Many cash-strapped Australians are rushing to sign up to their superannuation early. These are ways people are getting their money before retirement.

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EXCLUSIVE

The number of cash-strapped Australians accessing their superannuation early to pay for medical expenses such as weight-loss surgery or IVF and to meet mortgage repayments has soared, alarming new figures have showed.

New statistics from the Australian Taxation Office found between from July through to December last year there were more than 34,400 applications for early access to super based on compassionate grounds.

Of these 58 per cent were successful, allowing Australians to tap into $292.4 million of their retirement savings.

The average amount accessed was $15,200.

This rose 11.7 per cent from 30,800 applications in the six months prior from January to June 2019 and of these 57 per cent of applications got the green light.

As a result Australians accessed $259.4 million early.

The most recent ATO statistics showed medical treatments were the most common applications, with nearly 17,000 applications approved totalling $264.4 million.

This was followed by access super to prevent the foreclosure or forced sale of a person’s home – about 1200 applicants were successful totalling $14.9 million.

The Australian Institute of Superannuation Trustees’ chief executive officer Eva Scheerlinck said accessing super early should “only be considered as a last resort”.

“Drawing down from super early is very tightly controlled for a reason, to ensure that people’s savings are preserved for the retirement phase of their life,” she said.

“Consumers should be wary of early release advice from those with a vested interest in the release of their super.”

Mother-of-two Lucy Abraham, 59, suffered a workplace accident in 2016 that left her with arm, shoulder, wrist and elbow injuries has been left unable to work.

Battling financially she was forced to apply for early access to her small pool of superannuation savings a few months ago to help pay for expenses including rent, groceries and petrol.

“I didn’t have much super, I only had about $20,000,” Mrs Abraham said.

“At this age what was going to do with it anyway so I accessed it all because I can’t wait to retire to get it so I got the entire amount.

“I had to find some way to survive.”

Slater and Gordon principal Annemarie Gambera said they are regularly seeing clients who have been left struggling financially and accessing super is one of their last financial options.

“Their desperation leads to the consideration of accessing their super accounts balances first, but that’s not ideal,” she said.

“That money is there for retirement but sometimes while we appreciate it’s important to have an excellent standard of living come retirement sometimes the circumstances are that we don’t have that luxury.”

@sophieelsworth