When you reach
preservation age and that broadly is the legislated minimum age before which a
pension cannot be commenced.
In recent times, the
“magic age” for accessing a pension from your superfund has been 55 years of
age. However, from 1 July 2015 this age will be gradually increased to 60 years
of age, depending on your date of birth. If you were born on or after 1
July 1964 the magic age will be 60.
For example, a member
of a superannuation fund who turns 55 between 1 July 2015 and 30 June 2016
cannot start a transition to retirement pension during the 2016 fiscal year.
Severe penalties exist
for breaking pension rules and compliance is essential as is taking this into
account in retirement plans.
In an ageing Australia
there may be more changes to the ‘magic age’ and if this were to go ahead, the
preservation age to access your own superannuation monies would increase to 62
by 2023 and to 65 by 2035 where the aged pension age is proposed to increase to
70.