Generally, you cannot 'borrow' money from your superannuation in the traditional sense of taking out a loan. Instead, superannuation funds can only be accessed early through a 'withdrawal' under very specific and strict conditions set by the government. These conditions are primarily designed to help individuals facing genuine financial hardship or other critical circumstances.
When Can You Access Your Super Early?
One of the limited situations where you might be able to access your super early is due to severe financial hardship.
Accessing Super Due to Severe Financial Hardship
If you qualify under the severe financial hardship criteria, you may be eligible to withdraw a specific amount from your super. To meet these criteria, you generally need to be unable to meet your reasonable and immediate family living expenses, and you must have been receiving specific government income support payments for a certain period.
The amount you can withdraw under severe financial hardship is typically between $1,000 and $10,000 within a 12-month period. It's important to remember that this is a withdrawal, not a loan that you repay.
- Minimum Withdrawal: $1,000
- Maximum Withdrawal: $10,000
- Timeframe: Within a single 12-month period
Important Considerations
Before considering an early super withdrawal, keep the following in mind:
- Super Fund Rules: Not all super funds allow early withdrawals under severe financial hardship, even if you meet the government's criteria. You must check with your specific super fund provider to understand their policies and application process.
- Impact on Retirement: Withdrawing funds early significantly reduces your super balance, which can negatively impact your long-term retirement savings.
- Tax Implications: Early withdrawals from super can be subject to tax, depending on your age and the amount withdrawn. It's advisable to understand these implications before proceeding.
- Alternative Options: Always explore other financial assistance options before considering an early super withdrawal, such as government benefits, financial counselling services, or other forms of personal finance assistance.
Applying for Early Release
The process for applying for early release of superannuation due to severe financial hardship typically involves:
- Contacting your Super Fund: Your first step should always be to contact your superannuation provider directly. They will explain their specific requirements and provide the necessary forms.
- Gathering Documentation: You will likely need to provide evidence of your financial hardship, such as proof of government income support payments, bills, and statements showing your inability to meet living expenses.
- Lodging Your Application: Submit your completed application and supporting documents to your super fund. They will assess your eligibility based on the relevant regulations.
For more detailed information on early access to superannuation, you can refer to the Australian Taxation Office (ATO) website.
