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Can I retire at 55 and access my super?

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I am 55 years of age and have had a bout of illnesses which makes it hard for me to work full-time but I could get some part-time work. I am also helping my daughter with my first grandchild and therefore was wondering if I can retire and access my super, which is pretty good, but still do some work?

When you are between the ages of 55 and 59, you have to pass a retirement test, which proves that you have ceased work. By the way, you can pass this test as long as you work less than 10 hours a week. If you want to work more hours, you should look at what they call a transition to retirement pension. With this pension, there is no definition of what part-time is but you don’t retire — you just go from full-time to part-time work and you access some of your super to make up the rest of the money you need. The money is paid as a non-commutable pension, which is basically pension income and you can’t take it out as a lump sum payment.

What you have to remember is that there are cashing out restrictions and there is a maximum amount you can take as a non-commutable pension and it is 10 per cent. So if you had $300,000 in your super fund you could pull out $30,000 a year and with part-time work it could give you an OK single person’s income. I would recommend you go to the ATO’s website for more information. Centrelink would also be helpful. If your fund amount is very good, it might be sensible to talk to a financial planner.

For advice you can trust book a complimentary first appointment with Switzer Financial Services today.

Important information: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before acting, consider the appropriateness of the information, having regard to the individual’s objectives, financial situation and needs and, if necessary, seek appropriate professional advice.

Published on: Wednesday, August 10, 2011

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