Early release of superannuation due to severe financial hardship

If you are in severe financial hardship, you may be able to request early access to some of your super.

You may be able to withdraw some of your super early if you are experiencing severe financial hardship.

However, there are specific eligibility criteria and conditions that must be met for an individual to qualify for early release of superannuation due to severe financial hardship. If you do not meet all the criteria and conditions, then you will not be eligible for early release.

Applications are submitted to your super fund and each fund has its own processes and set of requirements. However, not all super funds allow early release.

This page outlines the steps you can take if you are experiencing severe financial hardship and considering early access to your super.

If you complete the steps below and your problem still hasn’t been solved, or you’re feeling overwhelmed, call us on 1800 007 007 to speak with one of our financial counsellors.

Steps to take if you’re considering early access to super

01

Consider other options

It may be tempting to view accessing your super early as an easy solution, but Super is meant to be for retirement.

TIPS – Alternative options

Before opting for early access, explore and consider all other options, including:

Concessions, grants and other financial assistance available if you need help with living expenses such as food, rent, electricity, gas or water bills;
No Interest Loans (NILS) to access credit for essential goods and services – with no interest or fees; and
Hardship assistance, such as reduced repayments or more time to pay, from your creditors.

Remember, making an informed decision is crucial, and our financial counsellors are here to assist you to do this.

Our financial counsellors can provide valuable insights and guidance tailored to your situation. If, after exploring alternatives and consulting with a financial counsellor, you find your current needs more pressing than future retirement needs, early access might be beneficial.

02

Assess the impact

Understanding the impact of early withdrawal of money from your superannuation is a crucial step in making an informed decision.

Possible impacts

Take the time to consider the following impacts and how they apply to your individual circ*mstances.

Less available in retirement:

Accessing super early means you will have less money in retirement or should you face another period of financial hardship.

Loss of protection from creditors:

Funds in superannuation accounts are protected from creditors. When funds are released early, they lose this protection.

Early access to super withdrawals are taxed:

Any super you withdraw for this purpose will be taxed and the tax amount will be deducted from the lump sum payment. If you are under 60 years old, tax of approximately 22% will be deducted.

Impact on government income support payments:

While generally not impacting government income support payments, the effect may vary based on the type of income support or pension you receive, your age, and how much you withdraw. Contact Centrelink or Department of Veterans Affairs first to assess the impact based on your individual circ*mstances.

Your super fund may not allow early release:

Super funds are not obligated to grant early access. If yours doesn’t, and after consulting with a financial counsellor, you’re confident it’s the right move, consider switching to a fund allowing early access. Though be mindful of transaction costs and potential loss of insurance cover.

03

Check your eligibility

The rules for accessing your super early due to severe financial hardship depend on your age in relation to your preservation age.

Check the table below to work out your preservation age.

If you have not reached your preservation age:

You are considered to be in severe financial hardship, and eligible for early release, if you meet all the following:

You are under your preservation age plus 39 weeks; and
You have been receiving an eligible government income support payment, from either Centrelink or the Department of Veterans’ Affairs, continuously for the last 26 weeks or more; and
You are unable to meet reasonable and immediate family living expenses; and
You can provide the required documents to evidence the above; and
You have not withdrawn super due to severe financial hardship within the previous 12 months.

If you satisfy all these conditions, you become eligible to apply for early release.

In such a case, you can request to withdraw and amount from $1,000 up to $10,000 from your super account. But remember, any withdrawn amount will be subject to tax before the remaining sum is provided to you as payment.

After you have reached your preservation age:

You are considered to be in severe financial hardship, and eligible for early release, if you meet all the following:

You have reached your preservation age plus 39 weeks; and
You have been receiving an eligible government income support payment, from either Centrelink or the Department of Veterans’ Affairs, for a cumulative period of 39 weeks or more since reaching your preservation age; and
You are not gainfully employed at the time of applying; and
You can provide the required documents to evidence the above.

If you satisfy all these conditions, you become eligible to apply for early release.

In such a case, there are no restrictions on how often you can apply or how much you can request to withdraw. But remember, any withdrawn amount will be subject to tax before the remaining sum is provided to you as payment.

Table: Preservation age based on date of birth

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
From 1 July 1964	60

Source: Australian Tax Office | Super Withdrawals | Preservation Age

04

Submit an application

Applications on grounds of severe financial hardship are submitted to your superannuation fund.

Before applying, contact your fund to check what their processes and requirements are.

Remember, your fund is not obligated to release funds early if their policy does not allow it. If you are in this situation, call 1800 007 007 and speak to one of our financial counsellors.

To apply you will need to write to your superannuation fund, completing their application form, and:

provide certified proof of identity
explain why you’re in severe financial hardship
demonstrate that you meet the eligibility criteria
include copies of specific overdue bills, which must be in your name, that you need to pay
provide a letter from Centrelink or DVA confirming you have received eligible income support payments continuously for 26 weeks or more (39 weeks if you have reached your preservation age). This letter is called a Q230 Financial Hardship letter
other information that your super fund requires as evidence of your severe financial hardship.

If your super fund is not satisfied with your application or that accessing your super will assist with your financial hardship, they may not approve your application.

TIPS

You can call Centrelink on their regular payment line to request that they provide you with a Q230 Financial Hardship letter. The letter is only valid for 21 days so make sure you give it to your super fund within that time.
Some super funds can check if you meet the income support requirements online directly with Centrelink, but you must agree to them doing this. This means you won’t need to contact Centrelink for a Q230 Financial Hardship letter.
Find out more about early access to super on the Australian Tax Office website.

05

Speak to one of our financial counsellors

If you’re feeling overwhelmed and need some help to deal with your financial hardship, you can speak with one of our financial counsellors.

Financial counsellors aren’t judgmental about your circ*mstances – they’re here to offer youfree, confidential and independentadvice and assistance.

To speak to a financial counsellor you can:

Call the National Debt Helpline on1800 007 007– open Weekdays from 9:30 am to 4:30 pm.
Use our live chat service by clicking the chat icon in the bottom right corner of your screen. Live chat is available 9:00 am to 8.00 pm weekdays. If you send a message outside these hours a financial counsellor will get back to you.
Make an appointmentto see a financial counsellor in your local area –Find a local Financial Counsellor.

CALL 1800 007 007

Early release of superannuation due to severe financial hardship - National Debt Helpline (2024)