More than $10 billion in superannuation has now been withdrawn by Australians, just over three weeks since the launch of the government’s early access scheme.
Billions more are likely to go, with Australians able to access an additional $10,000 on the 1st July. Half of all claims are being made by those under 35, according to Treasury figures.
With more than 1.41 million applications for withdrawal now received and paid, the figures indicate the level of financial distress many Australians are feeling right now – particularly those who are unable to access other schemes that have been designed to assist during the Pandemic.
Women already retire with significantly less superannuation than men. Knowing this may be behind the lower numbers of women accessing superannuation compared with men, with women pushing to protect at all costs what they have. Or it could be that a large portion of women simply don’t have any superannuation to access at all. Indeed, following these initial withdrawals, there are now more women with zero in their superannuation accounts — with AMP analysis of clients finding 14 per cent of women cleared out their accounts by taking this option.
Analysis shows that a woman in her early 40s has an average of just under $62,000 in superannuation — withdrawing the maximum $20,000 makes a significant dent in a balance that’s supposed to support her in retirement.
But it’s younger women who will be hit even harder, as Sarah Hill from YWCA outlines for Women’s Agenda today. It’s particularly unfortunate that the Morrison Government did not undertake a gender analysis of the full long term impacts of these early withdrawals.
Now, Kirstin Hunter, the recently appointed co founder of FutureSuper, wants to see options for the government to pay this superannuation back, especially following the $60 billion shortfall in the true cost of the JobKeeper scheme. And especially given the billions the Federal government spends subsidizing the fossil fuel industry.
FutureSuper’s already collected thousands of signatures on its petition asking the government to use the $12 billion that normally subsidises the fossil fuel industry to repay those who have been forced to dip into their super.
“These are people who are are being forced to chose between a comfortable retirement and food on the table right now,” she told me.
While the government can’t pay back every single person who has accessed their superannuation, Kirstin said it can make changes to reverse some of the damage that’s been done. And she believes it’d be a relatively simple process to establish.
Kirstin has many concerns about the current early access scheme, but especially noted how these withdrawals will disadvantage younger people later on.
“What’s really worrying is when you think about compounding. Ten thousand dollars now and ten thousand dollars in a few weeks time, but in fifty years that would be huge. It’s just so detrimental for people in retirement.”
And a further concern is the double-whammy currently occurring: If people are feeling forced to withdraw their superannuation, they’re also in no position to contribute to it — and may not be able to do for a long time yet.