Preservation Age and Age Pension Age: What’s the difference?

2 August 2024

If you're thinking about retirement, you may be starting to ask questions like 'when can I access my super?' Or 'when am I eligible for the Age Pension?' Your age plays a role in both answers. 

When you can access your super

You can access your super when you reach 60 years of age and retire. The meaning of ‘retire’ depends on your age and how and when you finished work:

• If you’re 60-64:
  
  • You stopped working permanently, or
  • You stopped working for any employer after you turned 60
• If you’re 65 or older: you can access all your super, even if you’re still working.

Accessing super early

In some cases you may be able to access your super earlier, such as:

• in times of financial hardship on compassionate grounds
• due to a terminal medical condition or permanent incapacity
• if you’re a temporary resident who’s leaving the country.

Things you can do once you've turned 60 years old

Choose to retire or keep working  

You don’t need to retire if you don’t want to. If you continue working and earning an income after your turn 60, your super can continue to accrue. You’ll automatically be able to access it once you reach the age of 65.  

If you keep working after you turn 60, you could also decide to transition into retirement with AustralianSuper's TTR Income account¹. This may allow you to either: 

• save more super – by adding to your super from your before-tax salary (using salary sacrifice²),
  or 
• work less – using your super to top up your reduced take-home pay.   

This account may allow you to cut back the hours you work, while drawing on your super to make up for a reduced income. 

If you choose to retire after you’ve turned 60, you’ll be able to start accessing money from your super.  

Start withdrawing super once you’ve met a condition of release  

Once you’re aged 60 to 64 and retire or if you're 65 or older, there are several ways you can access your super:  

• You can take your super as a lump sum. 
• You can set up an account based pension and draw a regular income, while your super stays invested.  

Keeping your super invested means you could continue to benefit from investment returns in retirement.

AustralianSuper’s account based pension is called Choice Income. It provides you flexible access to your super savings via regular income payments or lump sum withdrawals, while keeping your balanced invested throughout retirement. You can choose how much and when you want your payments, but you must take a minimum amount every year³. You can also choose to withdraw additional money. Your Choice Income account is flexible so you can also change your payment and investment options at any time.

Age Pension Age – minimum age to access the Government Age Pension 

What your Age Pension Age is 

Your Age Pension Age is the age at which you're able to access the Government Age Pension, if you meet eligibility requirements. This is also sometimes referred to as your ‘Qualifying Age’. From 1 July 2023, the Age Pension Age is 67 years old⁴. 

Even if you can access your super, you may be a few years away from being eligible to receive the Government Aged Pension.

Other eligibility requirements for the Government Age Pension

There are other factors that determine your eligibility for the Government Age Pension, including your:

• residency status;
• income; and
• assets.

Service Australia (Centrelink) uses 2 tests to work out your eligibility and calculate any Government Age Pension payments you may receive. They are the Assets test and the Income test.

Get support to plan your retirement

If you feel unsure about any of the information above, speaking to a qualified financial adviser can help.

If you’re ready to plan your retirement, we have different ways to help. Register for a webinar and explore our helpful articles and guides. We can also help you connect with an accredited financial adviser⁵, for personal advice tailored to your needs and goals.

EXPLORE YOUR ADVICE OPTIONS

References:
1. Transition to Retirement (TTR) can be complex and isn’t suited to everyone. It’s a good idea to get financial advice before deciding if a TTR Income account is right for you.
2. Consider getting financial advice before deciding if a salary sacrifice arrangement is right for you.
3. Minimum drawdown amounts apply depending on your age. For more information refer to the Choice Income PDS.
4. Source: Visit the Department of Social Services, Australian Government website for the latest information. Last updated 18 August 2023.
5. Personal financial product advice is provided under the Australian Financial Services Licence held by a third party and not by AustralianSuper Pty Ltd. Fees may apply.