Super fears for retirees

SELF-FUNDED retirees in the south-west have expressed concern over a potential lift in the age that Australians can access their superannuation.

The preservation age — a benchmark when retirees can make use of their superannuation — is presently 55 but the long-established ceiling will alter over the next decade — with the potential to be rolled back even further.

Concerns raised by the Association of Independent Retirees (AIR) south-west branch come after Treasurer Joe Hockey flagged a potential jump in the retirement age to 70 in order to rein in government expenditure.

Financial Services Council chief executive John Brogden added to speculation yesterday, saying he believed the superannuation access age should rise to 65.

The funds management lobbyist claimed it would be unfair to have such a large gap between self-funded retirees and pensioners.

While the retirement age and the superannuation preservation age are not directly linked, AIR Warrnambool branch spokesman Rod Carter said there needed to be greater clarity from the federal government on the matter.

“There’s been plenty of discussion around the aged pension but little said about what might happen with super in the federal budget,” Mr Carter said.

“It looks like there’s a view in government that people have to work longer, but whether that has anything to do with self-funded retirees, it’s unclear at the moment.”

The superannuation preservation age stands at 55 for all people born prior to July 1960.

People born in the 1960-61 financial year will be able to access their super once they turn 56; those born in the 1961-62 financial year will have to wait until 57 and so on, until the preservation age has risen to 60 years of age for superannuants born after June 1964.

The shift in the preservation age was part of sweeping financial reforms instituted under the Howard government in the late 1990s.

Meanwhile, Mr Carter said the Treasurer’s comments on the retiree pension age last week had posed some interesting social questions for average Australians.

“There’ll be some people who say 70 is far too old to retire yet others will be quite happy and able to work ’til that time,” he said. 

“It really depends on what type of work you’re in. 

“If it’s quite a physical job, something that involves regular manual labour, then it’s less likely, but if you’ve got a desk job then 70 might not be as big a dilemma.”

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