Are you a Defined Benefit Member?

If you are in one of the defined benefit divisions (that is, Division 2, 3 or 4), speak to us before you apply to access your superannuation. There are specific rules that apply to defined benefits that will impact on when and how you can access your super.

For Division 5 Accumulation Members

When can I get my super?

This is a very important thing to ask before retirement. Knowing this will help you make your plans!

If you are an Accumulation Division 5 member, you need to meet a ‘condition of release’ to access your super. These include:

  • You have reached your preservation age and have permanently retired
  • You have reached your preservation age and you have started a Transition to Retirement Pension Account
  • You have reached age 60 and have ended an employment arrangement
  • You are aged 65 (even if you’re still working).

For ElectricSuper members, you also may access your super from the age of 55. However, there are tax implications for doing this. Please speak to us for more information before you access your super. Book your appointment with us online.

If you were born before 1 July 1964, you have already reached your preservation age. If you were born on or after 1 July 1964, your preservation age is 60 years old.

Learn more about the requirements to accessing super in our video What are the Rules for Getting Your Super

You need to take care if you are thinking about taking your super before your 65th birthday. There are severe penalties for illegally accessing your super early. You must make sure that you understand relevant terms such as ‘preservation age’, ‘retired’, ‘employment arrangement’ and that you meet all the requirements.

If you are accessing your super because you have reached your preservation age and have permanently retired, for example, it is a requirement that you sign a declaration that you are not intending to return to employment ever again.

Read more about accessing your super in our article Accessing your super.

Can I take my super as a lump sum?

Absolutely – once you meet a condition of release (see the question above).

You can invest all of your super balance into an income stream at retirement, but it’s not a requirement. It’s your money, after all. You are welcome to withdraw some or all of it in a lump sum.

There are restrictions on the amount that you can move into the retirement phase of superannuation. This restriction is the Transfer Balance Cap. You are only permitted to move money up to the Transfer Balance Cap into the retirement phase of super. The Transfer Balance Cap is up to $1.9m in 2023/24. So, if you have more than this Cap amount in your super account, you could choose to leave the amount above the Cap in your super account, or you may choose to take the balance out as a lump sum.

See the question below about tax to understand the tax on any lump sum you do choose to take.

What if I run out of super?

The superannuation system exists to help people fund their retirement. However, there is a safety net in Australia – the age pension. Knowing what would happen if you run out of super is a great thing to ask before retirement

If your super isn’t enough on its own to provide you with a regular income from your retirement date all the way through until the end of your life, you are likely to access support from the age pension.

Depending on your situation and eligibility for the age pension, your regular retirement income could be made up partly from money from your super, supplemented by money from the age pension. Accessing the age pension like this will allow your super money to last longer than it would if you didn’t access the age pension.

From 1 January 2024, you need to be 67 years old to access the age pension. Along with this age requirement, income and asset tests will also apply.

If you do run out of super, the age pension will be in place to support you (if your age, income and assets mean you are eligible).

Do I have to take my super as soon as I retire?

No. If you don’t need to access your super, you are welcome to leave it in your super account once you have retired. You might have other investments which provide you with an income, or your spouse’s income might cover all your expenses, for example.

If you don’t withdraw your super, retirement is a good trigger to review your investment choice. There are 4 existing options for Division 5 Accumulation ElectricSuper members to choose from, or you can split your super across more than one option. There is a risk profiler available in the secure online member section of the website that can help you work out which investment option might suit you best.

A lap top has a post it note saying 'welcome back' on it. It's important to ask before retirement what happens if you want to go back to work.

Can I go back to work?

Generally, you can return to work after you’ve retired. However, there are a few conditions you need to keep in mind before you start back in employment.

If you retired under the condition of release that you’d ‘reached preservation age and retired’, you would have signed a declaration at that time stating that you weren’t intending to return to work. If you wish to return to employment, you will need to sign a new declaration that your situation has changed. You may need to prove to the ATO that your original declaration was genuine.

If you retired between the age of 60 and 65 because you had ‘ended an employment agreement’, you are able to return to work. However, you won’t be able to access any new contributions you receive from your new employer until you reach age 65 or until you end another employment agreement.

If you are accessing the Government Age Pension, there are limits on the amount of money you can earn from employment before it begins to affect your age pension. You can find out more about this on Services Australia’s website.

A blue puzzle piece has 'tax' written on it. It's being held between someone's thumb and forefinger. Getting a clear picture of the tax on retirement benefits is something that's important to ask before retirement.

What tax will I pay at retirement?

From age 60:

If you move your super to an income stream, the regular payments and any lump sums you take from ElectricSuper will be tax-free. You also aren’t taxed on the earnings you make on your investment in the income stream.

Also, if you take your super as a lump sum, rather than an income stream, it will also be tax-free once you are at least 60 years old.

Between age 55-59:

If you access your super while in this age bracket, your income payments from super are split into 2 components:

  • Taxable – this component is taxed at your marginal tax rate, minus a 15% tax offset
  • Tax-free – there is no more tax to pay

You can find out your taxable and tax-free components in the secure area of the member website.

Any earnings on your investment in the income stream are taxed at up to 15%, just as your earnings were taxed while you were still in the accumulation phase of super.

If you start a Transition to Retirement Income Stream, you will pay the tax as above depending on your age.

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