When can I retire?
There is no fixed retirement age in Australia and there are no laws that dictate when someone can retire. It’s completely up to you when you want to give up work for good or simply cut back on your work hours.
Many of us may dream of retiring early, but there are generally two age rules that impact when most Australians can retire, because they determine when you can access your super to help support you in retirement.
These are:
Preservation age
This is the earliest age that you can access your super under normal circumstances.
Age pension age
This is the age when you can access Australia’s Age Pension, provided that you meet the eligibility criteria – including that you’re an Australian resident and that you pass the income and assets tests.
When can I access my super?
Your super is designed to help fund your retirement. Generally, it’s only possible to withdraw your super after you’ve reached your ‘preservation age’ which is between 55 and 60, depending on when you were born.
Preservation age
| Date of birth | Preservation age |
|---|---|
| Before 1 July 1960 | 55 |
| 1 July 1960 – 30 June 1961 | 56 |
| 1 July 1961 – 30 June 1962 | 57 |
| 1 July 1962 – 30 June 1963 | 58 |
| 1 July 1963 – 30 June 1964 | 59 |
| From 1 July 1964 | 60 |
Although you can start accessing some of your super once you reach your preservation age, you won’t have access to all of it until you’ve also met a 'condition of release'.
Conditions of release
You can start accessing some of your super while you’re still working, once you’ve reached your preservation age, in the form of an income stream. But, if you want to withdraw your super as a cash lump sum, you need to also meet a condition of release.
Conditions of release that allow you to receive lump sums from your super include:
- Reaching your preservation age and fully retiring
- Turning 60 and ceasing employment after age 60
- Turning 65 (even if you’re still working)
- There are also some special cases where you may be able to withdraw your super savings early
- Death or Terminal Illness
- Total Permanent Incapacity (Invalidity)
- Financial Hardship
- Other specified grounds
If you’ve reached your preservation age, but you’re not quite ready to permanently retire and haven’t met a condition of release allowing access to lump sums, you can still access a portion of your super through a transition to retirement pension (TTR).
Accessing your super during a transition to retirement (TTR)
A TTR is an account-based pension that provides regular payments from your super. As part of your retirement plan, a TTR can give you more financial flexibility and free up precious time, or can help you maintain your work hours while saving on tax.
However, with a TTR it’s only possible to withdraw between 2% and 10% of your super savings every financial year.
If you’re considering this strategy, we recommend you speak to a financial adviser, to make sure it’s the right approach for you.
Deciding to Retire
Why do people retire?
Deciding when to retire is a personal decision, but there are 5 common factors that generally influence the retirement decision for most people. It’s good to keep these on your radar, as they can often trigger a decision to retire earlier than expected.
Health
You may have a health scare or issue that means you can no longer do your job. You may also decide to retire to care for a loved one.
Work
The demands of work can become more tiring as you get older, or you may be unable to find work as a result of redundancy or the end of a work contract.
Friends and Family
Retirement may be appealing if your friends or family are enjoying retirement.
Financial Independence
You may reach pension age, receive a financial windfall, or find that you have more financial resources after children leave home.
The Right Time
It may simply feel like the right time.
