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When can a member access super if they have never worked?

I had a question posed to me earlier this week regarding when a member would meet a condition of release if they have never worked.  It’s an interesting one because superannuation law prior to age 65 focuses on termination of gainful employment to be able to access superannuation benefits, whether as a lump sum or account based pension.

Where a member has never worked, superannuation law is clear that you cannot satisfy the condition of release being ‘retirement’.  This means that a member who has never worked would need to wait until age 65 to meet a condition of release with a nil cashing restriction (i.e. having access to capital).

A member reaching preservation age is defined as meeting a condition of release, however a cashing restriction still applies.  This means that the member’s benefits can only be accessed as a Transition to Retirement Income Stream (TRIS).

Any type of gainful employment in any capacity at any time may qualify a member to show a retirement condition of release being met, so it is important to understand how and when a member may start to access their super.

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4 thoughts on “When can a member access super if they have never worked?

  1. Great info Aaron…could you confirm your opinion re a member who has retired from gainful employment, but is under 65 and continues to put in member contributions – can i use the retirement COR for those new contributions or like your article, those contributions could only be accessed at 65?

    • Hi Damian,

      The condition of release will unrestrict the existing benefits, however future contributions will be preserved until another condition of release is met.

      Regards,
      Aaron

  2. Hi Aaron,
    Under SIS Reg 6.12 a preserved benefit becomes an unrestricted non-preserved benefit if a condition of a release with a nil cashing restriction is met eg retirement. If that condition of release (retirement) has been satisfied, and as Damian said, a member is under 65 and continues to make member contributions, why is there a requirement for a further condition of release to be met? Why can’t those future contributions (after retirement) immediately after they are contributed cease to be preserved benefits and become unrestricted non-preserved benefits by virtue of Reg 6.12? Thanks

    • Hi Dee,

      If the condition of release that was met was retirement and continued to be retirement, then you don’t have a problem. However, if for example the cashing condition met was change of employment for somebody b/w 60-64, then they would need to meet a further condition of release for subsequent contributions, in particular if they continued to work. That is my understanding of how the law operates.

      Regards,
      Aaron

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