I thought I would post this here since it may get a bit more traffic than the regional forum. My fiance isn't quite sure what to do about superannuation. What are the options; is he entitled to take it or what happens? He plans on living in the US indefinitely. I don't know anything about it so any help or feedback is much appreciated!!

Finally a question I can answer with confidence. Super has been my specialty for the last 6 years.

However its not good news. Unless your fiance is not an Australian citizen or resident whilst earning income in Australia the funds are protected until he reaches the Australian retirment age. If you give me his year of birth I can be a bit more specific.

sorry - Melannie (not John )

I hit the jackpot then! I am so glad to find someone who knows the answer. He was born in 1983 so definitely a long ways away from retirement. Does he just leave it where it is or is there anything we should do before he leaves? Here in the US you have the choice to move your funds to a 401k account with your bank - which many opt to do as they change jobs, etc. I just want to make sure we've got everything taken care of.

Thanks so much!!

At this stage and as long as Australia don't change the legislation (it happens in some way or another every year.) his retirement age and the age at which he can claim his super is 65 Same for me.

Unfortunately, Aus is one of those place where you can't move your retirement income to another country and can only be used as a retirement vehicle. This is because (assuming he is an Australian citizen) he can return to Australia and claim social security benefits at any time.

There are a few things I would suggest he check:

a) Is there any insurance on his super policy? If so investigate if he is covered when o/s. In most cases, you are covered for a nominal period but then this ceases. Which means you may think you are covered and then go to claim but will be ineligible. And they NEVER refund the premiums deducted from his policy.

How many policies does he have? Wherever possible consolidate them to reduce the fees being deducted.

c) Also when consolidating choose a fund which offers an Early Release of Funds under ‘Compassionate Grounds’. This will be the only way he will be able to access his funds should something unexpected happens prior to retirement. I included the definitions below.

The APRA (Australian Prudential Regulation Authority) website quotes

Specified grounds for release

If you cannot gain early access to your superannuation benefits on severe financial hardship grounds, you may consider asking APRA to approve the release of some or all of your benefits on specified grounds.

There are only very limited circumstances where benefits may be released on specified grounds. These are defined in Regulations and cover expenses in respect of:

• medical treatment or transport for the member or his/her dependant where the treatment is necessary to treat a life threatening illness or injury, or to alleviate acute or chronic pain or acute or chronic mental disturbance, and where such treatment is not readily available through the public health system;

• to prevent foreclosure of a mortgage, or exercise of a power of sale over the member's principal place of residence;

• modifications to the family home and/or vehicle to meet the special needs of a disabled member or his/her disabled dependant; or

• palliative care or death, funeral, or burial expenses for a member or his/her dependant.

The legislation also allows APRA to assess applications for Early release of benefits where the circumstances are consistent with, or in direct relationship to, the specified grounds.

Release of benefits to members who meet the specified grounds objective test will still be subject to the governing rules of their fund. These also apply to superannuation savings held in Retirement Savings Accounts (RSAs).

*NB Whilst there is another Early release called ‘Financial Hardship’ if he is not in receipt of an eligible Australian social security benefit for 26 continuous weeks he will not be able to claim And will be a waste of time.

Hope this helps.

I know it’s a bit of any essay. Its hard to stop when I get on a role.

Cheers

Melannie

I didn't even know you could have insurance on a super policy. I'm assuming he just has one policy - I'll have to double check with him in the morning. .. stay tuned I will probably come equipped with more questions once the time zones line up to an appropriate hour!

Ok, so he only has one policy (he signed something that rolled his previous super into the new one he has with current employer). He doesn't think he has insurance on it though. He'll be calling within the next couple of days to find out more. He just wants to make sure if he leaves it where it is that it won't decrease or something. Does he have to continue putting money in it??

Good news about rolling over. Just advise him to confirm it has been rolled into his current policy. Sometimes depending on which company's paperwork you use there can be delays. Like the need for a copy of photographic ID etc.

Unless he is voluntarily contributing to his policy along with his compulsarily required employer contribution he won't need to do a thing. Once he finished working his employer will cease contributing also.

He can choose to keep contributing voluntarily to enhance his retirement potential but it will depend on what you both want to do in the future and what US retirement you end up with.

On whether or not it will decrease there are no guarantees Until wait for it it gets below AUD$1000 then it is protected against fees, but not investment losses. Personally I looked at the super companies available and ended up choosing an industry fund because the fees are so low. It reduced my investment choices but suits my needs especially being so far from knowing what is going on in the Australian markets.

Remember though I'm not your financial adviser and your fiance may need to decide if to get some advice to make sure this will meet his need.

cheers

Melannie