Early withdrawals: Aussies ready to cash in super to ease financial burdens
More than half of Aussies say they would access their superannuation early if they had the option, according to new research by Finder.
A Finder survey of 1,090 respondents revealed 56% – equivalent to over 11.3 million people – would take out and use money from their super if they could.
Rising costs was the most common motivation for making a withdrawal, with 1 in 6 (17%) – 3.4 million people – saying it would help alleviate cost of living pressures.
This was followed by Aussies who said they would use their super to buy a home for themselves (15%), those who would put it towards an investment property (8%), and those who said they'd help buy a home for their kids (4%).
A further 8% of Aussies would use the funds to go on a holiday.
Alison Banney, superannuation expert at Finder, said early access to super isn't something that should be taken lightly.
"With the rising cost of living and the housing affordability crisis, the prospect of early access to super is a tempting one that is increasingly up for debate.
"Currently, there are a limited number of circumstances where you can access your super early such as financial hardship, compassion grounds and the First Home Super Save Scheme but just because you can doesn't mean you should.
"By taking money out of your super now you could be robbing Peter to pay Paul as you risk wiping tens of thousands of dollars off your retirement fund."
A lot of Aussies have their heads in the sand, with 59% admitting they don't know how much money they have in their super account.
Of those who do know, the average amount is $163,064.
Men ($205,166) report having almost double the amount of super than women ($116,812).
Data from ASFA in 2022 estimated that withdrawing $10,000 from your super at the age of 30 could cost you more than double that in retirement – a possible loss of $21,516.
Banney reminded Australians that making an early withdrawal from your super should be treated as a last resort.
"Superannuation is a valuable investment so it's important to check it regularly to ensure you're getting the best return possible and building it up as you head towards retirement," Banney said.
Younger generations were far more likely to want early access to their super with 69% of millennials and 65% of gen Z saying they would make use of this, compared to just 47% of gen X.
|If you could access your super before you retire, which of the following would you most like to use it for?|
|To help with cost of living pressures||17%|
|To buy myself a home||15%|
|Go on a holiday||8%|
|To buy an investment property||8%|
|To buy a home for my children||4%|
|I would not use my super even if I could access it before I retire||44%|
|Source: Finder survey of 1,090 respondents, June 2023|
Unsure of which fund to pick? Here are some tips for picking your super fund.