Still working after your preservation age? If a member has reached their preservation age, but are still working, they may be able to take advantage of a Transition to Retirement strategy in which the member begins to work less hours while topping up their income from their super balance. Income payments can be made fortnightly, monthly, quarterly, half-yearly or annually. Annual withdrawal amounts are calculated based on the member’s account balance and minimum pension factors each year, with a maximumwithdrawal of 10% of super account balances per year. Retired from the workforce? If the member has reached their preservation age and retired from the workforce, they may be eligible to start an income stream. By transferring the balance of their super account into a pension account, the member can withdraw regular payments or lump sumamounts tohelp fund their retirement. Insurance in super Some Hostplusmembers have Income Protection or Salary Continuance Cover associated with their super account. If amember is temporarily unable to work as a result of contracting COVID-19, theymay be able to claima regular monthly payment to help themmeet their living expenses. If themember holds current Income Protection cover, they may be eligible to claimon their insurance if themember: · has solely, as a result of injury or illness, become incapable of performing one or more of their duties of their regular occupation necessary to produce income, · is not engaging in any work, for wages or profit, and · is under the care of a medical practitioner and following treatment recommended by a medical practitioner. The member can login to Member Online to check their insurance arrangements. Temporary residents permanently leaving Australia If the member has entered Australia on an eligible temporary resident visa, they may be able to withdraw their super as a Departing Australia superannuation payment (DASP) once they have left Australia. Find out more about claiming you super after leaving Australia.
Important financial considerations Hostplus recognises the financial hardship being suffered by a large proportion of the community and fully supports Government initiatives aimed at providing relief during these challenging times. However, consistent with all decisions in relation to superannuation, we would encourage all members to carefully consider their individual circumstances — including their long-termfinancial situation, objectives and needs—before seeking early access to their retirement savings. The markets have experienced significant losses during recent weeks and there is a risk that unnecessarily accessing superannuation funds now will effectively crystalise these losses, leading to a compounding negative impact on retirement outcomes in the long term. For example, according tomodelling by SuperRatings, for a 25 year old, taking $10,000 out of their super now and $10,000 in July, this would have grown into a balance of approximately $134,700 at age 67 or $58,800 in today’s dollars. * Furthermore, from 1 April 2020, super funds are required to cease to provide insurance on accounts which have never had a balance of $6,000 or more on or after 1 November 2019, unless specific instructions are received from the account holder. The Putting Members’ Interests First legislation works to ensure that members aren’t paying for insurance they may have forgotten about and that premiums don’t inappropriately erode their retirement savings. We encourage all members to bemindful of their insurance arrangements when deciding whether to apply for early access to their superannuation. Which option is right for you? The information in this update is general in nature and does not take into account the individual circumstances of any member. Beforemaking a decision, eachmember should consider the own objectives, financial situation and needs. Members may also benefit froma conversation with a licensed financial planner. To arrange an initial no-obligation call with a Hostplus Financial Planner at no additional cost, members should visit hostplus.com.au/financial-planning today.
*Assumptions: based on ASIC’s MoneySmart calculator using a Growth option with an assumed investment return of 5.0%before fees and taxes on earnings. Assumes each individual’s birthday is today, withdrawals $10,000 today and another $10,000 on 24 July 2020. Host-Plus Pty Limited ABN 79 008 634 704, AFSL 244392 as trustee for the Hostplus Superannuation Fund (the Fund) ABN 68 657 495 890, MySuper No 68 657 495 890 198. INH 1237 04/20
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