• Background Image

    From the archives

    News

March 25, 2020

What you need to know about early access to your superannuation due to COVID-19

empty supermarket shelf

There’s no doubt things are not right in our world. Following from crippling droughts (still going on for many) and terrifying bushfires (again – still seeing thousands of people rebuilding their lives brick by brick), being slammed by a pandemic has left many of us with a heightened level of stress like we’ve probably never known.

The COVID-19 pandemic has had an unprecedented impact on so many aspects of our lives, including the global economy. In Australia, the shutdown of non-essential services and flow on economic impact has meant hundreds of thousands of Aussies are suddenly out of work and without income, entire industries have collapsed.

Money worries, let alone the thought of facing unemployment for God knows how long is always stressful, coupled the health risk and essentially being able to leave your house it’s totally understandable that we’re feeling at breaking point.

The Government has taken various actions to help the economy splutter along – one of them being the ability to access up to $20, 000 of your super early if you’re facing financial hardship as a result of COVID-19.

Before you run to the ATO to claim your super: a few things to consider

You could access up to $20,000 from your super over the next two financial years if you’ve lost income because of COVID-19. But make sure you’re across the full picture before getting stuck into your retirement fund.

There are a few reasons why you’d want to be incredibly sure it was absolutely necessary (read last resort) before taking your super out early. Because of the way super works its magic, with compound interest at its core, if you take it out now, it means there’s a lot less left to continue to grow and grow. One of the largest super funds, Hostplus, calculated that $20,000 withdrawn by a 25-year-old today would have mushroomed to around $132,000 by a retirement age of 67. So the impacts of taking even a small amount of super out are not to be taken lightly.

Furthermore, you’d be taking out your super at a very low time in the market (in other words, just a month or two ago that $20k in your super was probably worth more like $22-25k or more). Think of it a bit like having to sell your house when the market’s in a slump – it’s just not worth as much and you get a crap price. So it’s not ideal.

BUT, if things have gone to custard then that’s exactly what the Government has recognised and why they’re making it available. If that’s you – here’s what and how you need to go about seeing whether you can access your super, broken down whether you’re 1) if you’re eligible, 2) how to access it and 3) when you can access it (timing):

Eligibility

There are several criteria to be able to access it (such as being unemployed, on a job seeker payment, or were made redundant). You can check out the full list here.

BONUS FACT: you will not need to pay tax on amounts released and the money they withdraw will not affect Centrelink or Veterans’ Affairs payments.

How to apply

If you’re meet the access requirements, you then apply directly to the ATO – and can do that through the through the myGov website. You don’t apply through your super fund!

Once your application has been assessed and processed by the ATO you will be informed of whether you were successful or not for early release. Then the ATO will provide a copy of this result to your superannuation fund (which is the trigger for them to release your super payment). The super fund will then make the payment to you.

TIP –  while you don’t need to contact your super fund to access the payment, you may want to think about contacting your fund to check that they have your correct details, including your current bank account details and proof of identity documents so it can be as fast and seamless for you as possible.

Timing

Applications should be able to commence from mid-April 2020. The full $20,000 payment is broken down over two financial years, accessing up to  $10,000 before the end of June 2020 (the current financial year) and another 10,000 after July 2020 – when the next financial year starts. So you don’t get a $20,000 lump sum and presumably you need to go through the process twice to receive the full amount.

Finally

Whether you need to get early access to your super or not, the good news is Longevity will be here to help those of you who have had to perhaps access your super earlier due to hardship, or for those of you who need to just need to build up your nest egg after taking a bit of a hit.

Further links and resources

Thanks to Mamamia (@mamamiaus) for this handy list of support services if you need to talk about anything that’s going on for you:

Other links to related fact sheets and articles:

Treasury official announcement re early access to super: https://treasury.gov.au/sites/default/files/2020-03/Fact_sheet-Early_Access_to_Super_1.pdf

https://www.savings.com.au/savings-accounts/should-you-withdraw-from-your-superannuation-during-covid-19

https://www.theguardian.com/australia-news/2020/mar/23/early-access-to-superannuation-over-coronavirus-should-be-last-resort-advocates

https://www.abc.net.au/news/2020-03-23/australians-should-not-dip-into-super-coronavirus/12080208

Thsi information is general in nature and has been prepared without taking into account your financial objectives, situation or needs. Before making a decision in relation to your super you speak to a licensed financial professional and consider if the information is appropriate to you.

October 2, 2019

Here’s a list of companies that will pay you super on the unpaid part of your parental leave

Did you know that for many Australians taking time off for parental leave, you may get some money from your employer to replace your wage for a certain number of weeks, but most people don’t receive any superannuation? In fact taking time off to raise a young family is one of the key moments in life where the gap in retirement savings between men and women begins to blow out.

Well the good news is that businesses across Australia are starting to address this, with a number of large corporates such as HSBC, Woolworths, Unilever and more recently consulting firm PWC have having started to pay superannuation to staff that are taking time off for parental leave – which as you’d imagine is still typically women who are taking time out of the workplace to look after young babies. It’s for the most part an initiative to help to close the super gap, which sees women on average retiring with nearly half of the retirement savings as men.

As with the introduction of many an initiative, once one starts others follow suit and this is a copy cat trend that we’re delighted to see. Most recently Bain and Co have announced that consulting form Bain & Company will superannuation contributions for the unpaid portion of primary parental leave.

While this no doubt is a function of organisations wanting to “do the right thing” by their employees it’s also certainly seen as a business issue. Spokespersons within Bain & Company in Sydney recently stated that “organisations with greater diversity have greater retention, higher levels of employee advocacy, overall better performance and faster growth.” So naturally companies are looking for ways to retain women employees as of course it’s a central part of maintaining workplace diversity.

Either way you examine the issue, it’s a massive and positive step forward, we’re looking forward  to seeing more companies taking up this initiative – just as we’re looking forward to seeing gender parity in those taking time off on parental leave too.

We’ve started putting together a list of companies that have started to pay superannuation on the unpaid portion. Let us know if there are others on the we can add to the list:

ANZ

Bain & Co

Commonwealth Bank

Corrs Chambers Westgarth

Dexus

Fairfax

HSBC Australia

NAB

NGS Super

PWC

Unilever

Viva Energy

Westpac

Woolworths

Others? Let us know and we’ll add them to the list. connect@mylongevityapp.com

August 6, 2019

Why we started Longevity App

August and September are big months for the topic of gender equality. With the latest ABS data on average weekly earnings (used to calculate the Gender Pay Gap) coming out in August and Equal Pay Day following shortly after there’s lots to talk about.

If anyone saw Q&A this week, where Ricci Bartels shared her story about struggling to find employment later in life and the toughest time of her life that she lived through as a result.  While highlighting a range of political and social issues that no doubt needs our focus and attention, it was a scarily important reminder of why it’s vital to be as proactive as possible about preparing for our future because it’s so easy for things in our lives to change. Women in particular find themselves particularly financially vulnerable later in life, making it a perfect time to focus on ket gender equality issues such as women and financial insecurity with the imminent release of up-to-date data on the pay gap and its progress being released.

As a part of it, we’ve got lots of great content and articles planned to continue the conversation on financial equality. And, as a little warm up our CEO, Carla Harris got to speak to the awesome team at Women Love Tech about why the stubborn gender pay gap got her on a mission to change our financial future whenever we spend. Check out the article here.

May 30, 2019

Longevity App CEO Carla Harris nominated for Fintech Leader of the Year at the 2019 Women in Finance Awards

NEWS

Longevity App CEO and co-founder, Carla Harris has been selected as a finalist for this years Women in Finance Awards as Fintech Leader of the Year.

The Women in Finance Awards, in partnership with AMP Bank, is a national awards program recognising the contribution of women in the finance industry. This award is dedicated to recognising excellence among the industry’s top female professionals who are shaping and influencing the financial services industry.

Dr Harris said she was thrilled to be nominated, especially given the incredible calibre of the other finalists.

“The awards are a great opportunity to be able to take stock of the other incredible female leaders in the Fintech community and Finance sector in general, sectors that are notoriously male dominated. Diversity and equality is at the heart of everything we stand for at Longevity, so to be recognised for my contribution to the sector as well as Longevity’s positive impact on our customers financial futures is fantastic.” Harris said.

Micro-savings tool, Longevity App, offers an simple solution to the complex problem of inadequate retirement savings, allowing users to make small but regular contributions to their superannuation, linked to their everyday spending. “With many Australians facing a significant shortfall in their retirement savings, and women on average retiring with almost half that of men, we saw the need to put a new tool into the hands of people that will allow then to change how they save for and engage with their super. Longevity App is the perfect tool to facilitate that by connecting our everyday spending with our long-term saving.” She said.

The winners will be announced at celebration dinner on August 1 2019.