The superannuation preservation age changes from age 55 to 60 depending on your date of birth.

The change in superannuation preservation age signifies when you are able to access your super savings.

You can use your preservation age to calculate how long it takes to get your superannuation back after contributing it to super.

There are no superannuation loopholes; however, there are other ways in which you can access your super early.

The ways you can access your superannuation early will be discussed later on in this article.
 

 Superannuation Preservation Age Changes

 
What is the superannuation preservation age for super?

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The table below details the changes in superannuation preservation age based on when you were born.

Date of Birth Preservation Age
Before 1 July 1960 55
1 July 1960 – 30 June 1961 56
1 July 1961 – 30 June 1962 57
1 July 1962 – 30 June 1963 58
1 July 1963 – 30 June 1964 59
After 1 July 1964 60

Upon reaching your superannuation preservation age, you become eligible to access your super in one of three ways.
 

What Age Can I Withdraw My Super?

 
The age that you can withdraw your super and the way you access it will depend on your situation.

It will also depend on the change in preservation age based on your year of birth.
 

1. Retired with no intention of returning to work

Once you reach your preservation age, you can withdraw your super as a lump sum and/or account based pension, provided you have retired with no intention of returning to full-time or part-time work.

Retiring with no intention of returning to work satisifies one of the superannuation conditions of release’s definitions of retirement.

Some people use this as a super preservation age loophole, where they finish a job with an employer and say they have no intention of returning to work, when in fact that is not their intention at all.

The seemingly subjective wording of this retirement rule can create loopholes, but it should not be abused.

I would advise against this using this apparent loophole.

If you plan on accessing your super through the application of this condition of release, you should genuinely have no intention of returning to work.

It should not be used to gain early access to your super.

By meeting this condition of release, your super savings become fully accessible to you and can be taken as a lump sum, income stream, or a combination.

You should, however, be mindful of any tax implications on super withdrawals, particularly while under age 60.

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2. Reached preservation age and still working

If you have reached your preservation age but will be continuing to work, you can still access your super.

Access to your super can be achieved through a transition to retirement income stream.

A transition to retirement (TTR) income stream is also referred to as a non-commutable income stream.

A TTR pension is an income stream that can be started using some or all of your super accumulation account savings.

By starting a TTR pension, you can receive an income of anywhere between 4% and 10% of your account balance each financial year.

This income can be used to supplement your other sources of income, pay down debt, or employ a transition to retirement strategy.

Because you will presumably be continuing to work, you should consider maintaining a small balance in your accumulation account, so that the account remains open to accept future super contributions from you or your employer.

Another reason to keep a small balance in your accumulation account is to preserve insurances.

If you have insurances within your super, such as death, TPD or income protection cover, you want to ensure premiums can continue to be funded so the insurance doesn’t lapse.

Using your total accumulation balance to start a TTR income stream, could result in your accumulation account being closed and insurances cancelled.

It may be difficult to obtain new insurance cover for various reasons.
 

3. Super rules for over 60?

If your preservation age is 60, based on the changes in the table above, there is actually another condition of release that can be utilised.

You can use this condition of release even if your preservation age is below 60, but you are now over 60.

The condition of release is this: having an employment arrangement come to an end after reaching age 60.

By meting this condition of release you are satisfying the second definition of retirement.

This means you can have full unrestricted access to the super you have accumulated up until meeting that condition.

If you do meet this condition of release, you are permitted to start a new job on either a full-time or part-time basis and still have access to you super.

However, any contributions made to your account after meeting the condition of release will not be accessible until you meet another condition of release.
 

When Can I Access My Super Tax Free?

 
Accessing super tax free will depend on two things: your age and the tax components that make up your balance.

Let’s begin with superannuation tax components.

If you contact your superannuation fund, they can tell you the tax componets that form your balance.

You super balance will be made up of some or all of the tax-free component, taxable (taxed) component and taxable (untaxed) component.

All super withdrawals must be made proportionately from each component.

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This is true whether your withdrawal is made of a lump sum or an income stream payment.

Under age 60, the tax-free component will be received tax free and the taxable components will be generally assessable.

However, the taxable component may be able to be received tax free using the lifetime low-rate cap.

Over age 60, the tax-free component and taxable (taxed) component are received tax free, but the taxable (untaxed) component remains assessable.

Read this post for taxation of the taxable component.
 

Superannuation Preservation Age Calculator

 
You can see how your preservation age changes based on your year of birth using the calculator below.

It is important to keep on top of any potential superannuation preservation age changes, as the retirement rules are subject to change.

Chris Strano

Chris Strano created SuperGuy to help the average punter navigate through the complex and ever-changing super rules. It has since become one of Australia's leading digital super resources. Subscribe to SuperGuy's YouTube channel for the latest strategies to boost your super savings. https://www.youtube.com/c/superguyau

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