13th Nov 2012
Can I use super to pay my mortgage?
Author: Craig Hall

YOURLifeChoices member Tony is trying to reduce his debt by paying off some of his mortgage with funds from his super. Craig Hall of NICRI advises if this is possible.

Q. Tony
At 57 I believe I can now access the money in my super. I still have quite a large mortgage and while I can make the repayments, I would like to reduce my outgoings so I could possibly reduce my working hours. Is it possible to take $200,000 from my super and pay off half my mortgage?

A. Provided by Craig Hall, NICRI
I refer to your question regarding accessing your superannuation. Access to superannuation requires the member meeting a ‘condition of release’. One of those is reaching preservation age (currently age 55) and being permanently retired. Whilst you have reached preservation age, you are still working. This means that you are unable to access a $200,000 lump sum until you:

  • permanently retire (tax may be applicable while under age 60); or
  • have a change to your conditions of employment after reaching age 60, such as changing employer or going from full time to part time with the same employer, thus creating an unrestricted non-preserved component; or
  • have enough ‘unrestricted non-preserved’ funds you can access (this may include benefits for which a member previously satisfied a condition of release and elected to keep the money in the fund, or from certain personal contributions made prior to 1 July 1999). You would need to refer to your fund for this information; or
  • reach age 65 in which case you can access the funds whether working or not.

So the likely short answer to this question, as it stands is no. However, you can access part of your superannuation under a ‘Transition to Retirement Pension’ (TRP) arrangement.

Click NEXT to find out more about TRP arrangements.

    1  2  Next


    To make a comment, please register or login

    Join YOURLifeChoices, it’s free

    • Receive our daily enewsletter
    • Enter competitions
    • Comment on articles