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Early access to superannuation scheme extended until late December

Published: (Updated: ) in Australian News by .

Australians keen to access another $10,000 of their superannuation have been granted an extra three months to apply.

Australians keen to access another $10,000 of their superannuation have been granted an extra three months to apply for financial assistance.

Revealed in the government's fiscal update today, eligible residents who wish to draw another $10,000 from their superannuation early have until December 30 to do so.

Under the original scheme, individuals who are impacted financially by COVID-19 were allowed to withdraw $10,000 from their superannuation in the 2019-2020 financial year, and an additional $10,000 in the 2020-2021 financial year.

READ MORE: The Aussies who accessed superannuation early because of COVID-19 revealed

Cormann Centrelink

The application period was initially only up to September 24 this year.

Figures from the Australian Prudential Regulation Authority (APRA) show 2.8 million Australians have applied for early access to their superannuation.

More than $25 billion has been paid out, with the average applicant receiving $7718 of their superannuation.

Dale Gillham, chief analyst of Wealth Within, said early access to superannuation may leave some short changed when it comes to retirement.

"Several people I have spoken to who accessed the money did not need it, but wanted it simply because they do not like superannuation," Mr Gillham said.

"While others have used the money to pay bills or reduce debt to give themselves some breathing space during the lockdown, you have to ask is this robbing Peter to pay Paul?"

READ MORE: Accessed your super early? Here's what you should know

People are seen waiting in line at the Prahran Centrelink office in Melbourne, Tuesday, March 24, 2020.

Mr Gillham said accessing super now could be robbing yourself of returns in 20 years time.

"If you take $10,000 out of superannuation, then according to ASIC's compound interest calculator, your superannuation would be worse off by around $27,000, assuming a compounded growth rate of 5 per cent over 20 years," Mr Gillham said.

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"If you take the full $20,000, then you will be over $54,000 worse off in 20 years based on the same compounded growth rate. So, did the scheme do what it was supposed to do?

"We don't really know the impact of that just yet, but what we know is that those who took the money will be worse off in retirement, which is not good."

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The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs.

Source: 9News https://www.9news.com.au/national/coronavirus-budget-early-access-to-superannuation-extended-until-christmas/35f7425a-7e84-4301-94f0-3e51458c047b

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Finance Advice 2021