Planning to retire at 60? What you need to consider

For many people, when it comes to planning retirement, age 60 sounds like a good time to leave the workforce.

If that’s your plan, it’s important to ensure you understand the rules on accessing your super, how big your nest egg needs to be, the tax you might pay and any financial assistance you may be able to receive.

To help you take the leap into life after work, SuperGuide has put together a list of some of the common questions asked by people thinking about retiring at 60.

1. When can I access my super?

If you want access to all your super savings and are age 60 or older, you have three options:

• Resign from your employer (even your second job) after you turn age 60. You are then permitted to access all your super that has accumulated to that date, even if you are still working in another job or plan to return to work.
• If you left work before turning age 60, you can access your super if you declare that you never intend to return to the workforce for 10 hours a week or more.
• If you have never worked, you cannot leave the workforce as you were never employed, so you will need to wait until you turn 65 to access your super. The super regulations require you to have ended “an arrangement under which you were gainfully employed” to access your super account prior to age 65.

If you withdraw your super benefits once you reach 60, most people pay no tax on their retirement savings.

Do keep in mind though, if you retire at 60 and withdraw your super, you miss out on the benefits of compound interest and the tax benefits available if you were to leave your savings within the super system for longer. This can have a significant impact on how much income you have in later years.

2. Can I access my super at 60 and still work?