AMP’s team of technical superannuation experts have seen a spike in questions about accessing superannuation.
Questions about accessing superannuation and understanding conditions of release were the top issues for financial advisers seeking to help their clients, based on the over 2,000 calls made to AMP’s adviser support line in February.
Other issues raised by financial advisers in February included: non-concessional contribution caps, how transition to retirement pensions work, how superannuation death benefits work and understanding TPD insurance in super.
“This month we saw a focus on understanding the conditions that need to be met before people can access their super,” said AMP Technical Strategy Manager John Perri.
“In particular, many Australians don’t realise they can access super early if they change jobs between the ages of 60 and 65, even if they continue working in a new job,” said Perri.
“However, super benefits can be accessed as a tax-free lump sum during this period, or used to commence a retirement income stream, which receives both a tax exemption on earnings, and has no maximum pension restriction.”
“This may be more flexible and tax efficient than using a Transition to Retirement’ pension, which doesn’t receive a tax exemption on earnings, and has a maximum income payment of 10 per cent of the account balance.”
“The key insight is if someone changing jobs on or after age 60, it may be an opportunity to consider accessing your super.”
“However, it’s important that people fully understand the policy and carefully consider, the potential impacts on their super before they decide to access it,” Mr Perri said.