In general, the law doesn't allow you to access your superannuation until you reach the minimum age of 55. There are conditions and the law is constantly changing. This requirement is based on sound reasoning.

Superannuation is designed to provide a secure and regular income during retirement. Getting early access to your superannuation funds and spending the money can leave you potentially destitute later in life. There are many stories of people who after being diagnosed with HIV in the 1980s, thought they were going to die, cashed up their assets and spent the money, only to find in the 1990s they were very much alive, penniless, reliant on Social Security and without savings for retirement and old age.

It is crucial to carefully consider your options. It could be helpful to speak to your doctor about your current and projected state of health, and any factors that may contribute to you needing to access your superannuation before the age of 55.

Experiencing financial hardship?

If you are experiencing financial difficulties, consider consulting a financial counsellor. Bobby Goldsmith Foundation (BGF) offer free financial counsellors who give confidential professional advice and help you explore your financial options.

Take a look at the Managing money and debt chapter on this website.

The three grounds for early release of superannuation

If you think applying for the early release of your super is a good option for you, there are only three very specific grounds on which you can access it.

• Total and permanent disability (TPD)
• Financial hardship
• Compassionate grounds

Early release of superannuation claims can be complex and take a long time.  A claim under Total and Permanent Disability (TPD) can take over a year, while Financial Hardship claims take at least six weeks. Getting legal advice before you start the process may save you a lot of time and energy.

The HIV/AIDS Legal Centre (HALC) is a specialist community legal centre that provides free legal advice to people living with HIV/AIDS who want to apply for early release of superannuation.

Total and permanent disability (TPD)

Most superannuation funds have a total and permanent disability (TPD) insurance component. A part of your superannuation is used to pay the insurance premiums and compensate you if you become totally and permanently disabled before retirement. This means that if you become TPD, you may claim on the insurance and receive the balance of your superannuation prior to retirement age. The definition of TPD is based on the wording in each individual policy. However, a common sense interpretation will give you a good idea of whether you might fit within the TPD definition or not. To fit the definition, you must be both totally and permanently unable to work (usually) in an occupation for which you are experienced, skilled or trained. If you are only partially unable to work, or if you are likely to work in the future, then you do not fit the definition.

A claim is based on medical evidence, so the first step in any claim is to speak to your doctor and get their opinion on your work capacity and whether they would support a TPD claim. For peace of mind, it may be wise to check out the TPD insurance provided by your super fund. Questions to consider include:

• Do you have TPD insurance?
• What does it provide for?
• What definition of TPD is applied when you make a claim?
• Consider whether the insurance appropriately covers you. For instance, some TPD insurance has a minimum number of hours worked before you can make a claim. If you're working part-time, you may not be properly covered by the insurance.

Being totally and permanently disabled may also allow you to get all your funds out of your super account. The Trustee must determine that you are TPD to release the funds. This release of funds can happen regardless of whether you are eligible for any TPD insurance or not. You may need to consider the income tax implications. The changing nature of taxation provisions means you should talk with a professional financial adviser or the Australian Tax Office to assess your tax requirements.

Financial hardship

Most superannuation policies allow you to apply for early release of your superannuation on the grounds of financial hardship, however you should check with your specific superannuation provider. If you have more than one superannuation policy, and you wish to make a financial hardship claim, you may want to consider rolling over all your funds into the super fund that allows financial hardship claims. The standard definition for early release on financial hardship grounds is where you are unable to meet your (reasonable) daily living expenses.

To qualify for financial hardship, you must have been receiving a Centrelink or Social Security benefit for at least 26 weeks, or six months. You will need to produce a letter from Centrelink stating that you have been on Social Security benefits for that time.

Superannuation providers are able to make payments of up to $10,000 per annum for financial hardship claims and of no less than $1,000 unless the balance of the fund is less than that amount. Claims are only likely to be successful if you can show that you require specific amounts of money for particular purposes, rather than simply requesting $10,000. Collect records of any debts you may have to support your claim. You will need to provide an income and expenses declaration. This must include documentary evidence of your debts and expenses.

Bear in mind that only the minimum monthly payment and not the total balance are included for credit card debts. If the bulk of your hardship claim is from credit card debt, it might be worth consolidating or re-arranging the debt before making a claim. Get financial advice from a financial counsellor at the Bobby Goldsmith Foundation (BGF) or the Consumer Credit Legal Centre to fully understand your options.

In the case of debts to family members and other informal debts where there is no paper trail, evidence of the debt can be provided by a statutory declaration. The HIV/AIDS Legal Centre (HALC) or a BGF Financial Counsellor will be able to advise you about this.

Applications for financial hardship claims on superannuation routinely take at least six weeks to process. If you are experiencing difficulties, Bobby Goldsmith Foundation (BGF) and Centrelink provide emergency loans (see contact information in the main menu of this chapter).

There are two other grounds for early release of funds on financial hardship:

1. Where you are suffering from a life-threatening illness and the financial stress is exacerbating that illness. You will need two medical letters from a GP and an HIV specialist, each stating the amount you need to be released from your super, and stating that the funds will help alleviate your condition. There is no cap on the amount that can be released.
2. Where you are suffering from acute or chronic illness or acute pain, and are unlikely to return to the workforce in the foreseeable future.

Applications under these grounds need to be made to the Australian Prudential Regulation Authority (APRA), and if approved would be forwarded to the super fund for the trustee's approval. Release of funds is always discretionary on the part of the trustee of the super fund (see below).

Compassionate grounds

 The Australian Prudential Regulation Authority (APRA) can allow early release of superannuation on specified compassionate grounds. You must be able to show that you either have expenses related to palliative care, or the care and treatment of chronic pain or illness (for yourself or your partner), and that these costs are not available within the public health system. Alternatively, you must be able to show that the financial institution holding your mortgage is threatening to foreclose on your property.

Claims are more likely to be successful if you can show that you require specific amounts of money for specific purposes. You will need to show records of your debts or general expenses, medical expenses (or quotations of expected medical expenses) and letters from your mortgage provider to support your claim.

Specific evidence will be required which is relevant to each reason for the early release of your super. For instance - for medical care, you will need a doctor's report on your condition stating that the treatment is not available under the public health system; for mortgage relief, a foreclosure letter is required from the lender.

More info

The Association of Superannuation Funds of Australia (ASFA)

The ASFA protects, promotes and advances the interests of Australia's superannuation funds, their trustees and members. They also provide a range of information and resources to ensure members are kept up to date on matters affecting superannuation.

Web: www.superannuation.asn.au

The HIV/AIDS Legal Centre (HALC)

HALC is a specialist community legal centre that provides free legal advice to people living with HIV/AIDS on related legal matters. HALC recognises that people living with and affected by HIV/AIDS have special legal needs. As well as assisting people with superannuation claims, HALC can also provide assistance in other areas where HIV may impact on legal issues, such as discrimination, immigration, wills and insurance matters.

Web: halc@halc.org.au

Bobby Goldsmith Foundation (BGF)

Bobby Goldsmith Foundation (BGF) Financial Counselling is for all people with HIV, whether you are on a pension or working.

Email: bgf@bgf.org.au

Acknowledgement

This information has been produced with the generous assistance of the HIV/AIDS Legal Centre (HALC). ACON would like to acknowledge and thank the HIV/AIDS Legal Centre.

Disclaimer

This website aims to provide you with useful information, but for medical and/or legal advice and information specific to your situation, you should always see a qualified professional.

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These web chapters targeting people living with HIV have in part been made possible due to generous support from Gilead.