There are three ways to gain access to superannuation after age 60.
One such way will only provide limited access. The other two ways will provide full access.
In every case, an individual is required to meet a superannuation condition of release in order to access their superannuation savings.
Attaining age 60 does not, in itself, provide full access to superannuation. Other conditions are required to be met for superannuation benefits to become fully accessible.
This article will discuss the three options available to individuals over age 60 in accessing their superannuation retirement savings, including access to super lump sum payments and withdrawals over 60, as well as income stream options.
The three conditions of release available to people in accessing their super after 60 (but before 65) are as follows:
1. Limited access while still working via the transition to retirement (TTR) rules
2. An employment arrangement coming to an end after age 60
3. An employment arrangement coming to an end after the individual’s preservation age, with no intention of returning to work
Each of these will be discussed in a little more detail below.
Access To Superannaution After 60: Still Working (TTR Rules)
A person over age 60 who has not ceased an employment arrangement after attaining age 60 is able to access their super by meeting the ‘attaining preservation age’ condition of release.
The table below details when a person has attained their preservation age:
|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|
The transition to retirement rules permit a TTR Pension to be commenced with some or all of a member’s superannuation accumulation account savings.
The limitation of a TTR Pension is that only an income equivalent to between 4% and 10% of the pension account balance can be drawn each year. This is based on the account balance at 1 July of each year. A pro-rata calculation is required for part years.
Access To Superannuation After 60: Ceasing An Employment Arrangement
A person who was working but ceased an employment arrangement after attaining age 60 has full access to the superannuation savings that they have built up in their accumulation account up until that point in time.
Ceasing an employment arrangement after age 60 may arise as a result of a change in roles (provided there is a formal change in an employment arrangement), a change in companies, or simply stopping work.
By meeting this condition of release, an individual has met the definition of retirement and may commence a standard account based pension (i.e. not limited by the upper 10% income threshold as with the TTR Pension) and/or make a lump sum withdrawal from super, providing them with access to superannuation after 60.
There is no restriction on returning to work after accessing superannuation under this condition of release. However, any subsequent contributions after meeting this condition of release will be preserved and not fully accessible until another condition of release is met – even if this means another employment arrangement coming to an end.
Access To Superannuation After 60: Retired With No Intention Of Returning to Work
Depending on a person’s date of birth, this superannuation condition of release does not necessarily rely on a person attaining age 60.
This condition of release can be achieved once an individual has met their superannuation preservation age, as detailed in the table above.
The rules of this condition of release is that a person’s employment arrangement comes to an end after reaching their preservation age and that person has satisfied the trustee of their superannuation fund that they have no intention of returning to work on a full-time or part-time basis, as defined by legislation. Being gainfully employed for less than 10 hours per week is generally permitted.
Before commencing an income stream product, a person should understand the implications of the Transfer Balance Cap.