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Thinking about tapping into your super early to help with mounting expenses? It’s not easy as the eligibility rules are strict.

You must meet a “condition of release” before you can access you super. The major events are attaining 65 years and “retirement”, which both allow you to access your entire super balance. If you haven’t met these milestones but have reached preservation age (currently 57 years, but set to gradually increase to 60 over the next few years), you can start a “transition to retirement income stream”, which lets you access up to 10% of your super balance each year.

Other grounds include temporary or permanent incapacity and having a terminal medical condition. But if none of these grounds apply to you, you might qualify under other grounds.

If you’re currently receiving income support from the government, you may qualify for “severe financial hardship” release. You must apply to the trustee of your super fund, who will decide whether you qualify.

If you’re below preservation age, there are two major requirements. First, you must have been receiving Commonwealth income support payments for a continuous period of 26 weeks. Second, the trustee of your super fund must be satisfied that you’re unable to meet “reasonable and immediate family living expenses”. If you meet these criteria, you can access up to $10,000 of your superannuation per year as a single lump sum.

However, if you’ve reached preservation age you can potentially access any amount of your super balance. To qualify, you must have been receiving income support for at least 39 weeks since you reached preservation age, and the trustee must be satisfied you’re not currently gainfully employed on a full-time or part-time basis.

An alternative release is “compassionate” grounds, which apply where you don’t have the financial capacity to pay expenses for a number of pressing situations, including medical treatment or medical transport; preventing foreclosure on your home; palliative care; or funeral expenses for a dependant.

To access compassionate release, you must apply to the ATO, who will determine an amount that you “reasonably require” to pay the expense, which can then be released by your super fund.

Whatever your situation, it’s a good idea to talk to an adviser about your financial difficulties for help exploring all your financial options, to consider the tax consequences of accessing super early and to get assistance with applying for a release. Contact us today for expert advice to help you get your finances back on track.

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