The COVID-19 pandemic has significantly impacted the superannuation savings of most Australians.
Firstly, the economic downturn resulted in investment markets heading south. Asset values have fallen, so superannuation balances have fallen, impacting both people saving for retirement and current retirees.
The second trigger is the ability for Australians to withdraw up to $10,000 of their superannuation in the 2019-20 financial year, and a further $10,000 between 1 July and 31 December 2020, upon meeting certain requirements.
While investment markets go through cycles that are as predictable as day following night, intentionally withdrawing money from superannuation early can have a more damaging effect.
Whether allowing people early access to their superannuation to help them weather financial hardship brought about by COVID-19 was right or not, is a question that gets emotions running high.
There is one school of thought – generally driven by the industry superannuation funds, and even former Prime Minister Paul Keating – that argues allowing people early access to their super is a bad thing. Their case is argued on the basis that withdrawing money from super means that less will be available for retirement when that eventually arrives…… Continue reading here….
