2014 Federal Budget: Mega Millionaire Dangers
With the age pension age increasing the Government is pondering whether age restrictions on accessing superannuation balances should change.
With mature Australians needing to wait until they are 70 years of age by 2035 before they can access the pension, many will need to continue working unless they have sufficient capital to allow an early retirement.
The danger is that wealthy Australians put ‘too much’ of the investment assets into superannuation, and then can’t access it at a new a higher age set by the Government, and are forced to work until they are eligible to access their superannuation income stream.
If wealthy superannuants are preventing from accessing their superannuation then they will be competing with the pre-pensioners for the same jobs.
So in 2035 there could be two 68 year-olds, one with 5 million dollars in superannuation and the other with nothing in superannuation, and they are both competing for the same job because neither of them can access a retirement income, from either superannuation or the age pension.
This is why the Government should not increase the preservation age for accessing superannuation benefits, at least where the superannuant has sufficient assets locked away to properly fund their retirement.