New Super Withdrawal Rules Start June 1 – What It Means For Your Retirement Savings
Starting June 1, 2025, new rules will come into effect that significantly reshape how Australians can access their superannuation savings. The changes are designed to promote long-term retirement income security, reduce the risk of outliving your savings, and encourage smarter financial planning.
Understanding how these updates affect you is crucial, whether you’re approaching retirement or already drawing on your super.
Key Changes to Superannuation Withdrawals
Increase in Preservation Age
The preservation age — the minimum age at which you can access your super — will begin a gradual increase from 60 to 70 by 2030. This change encourages Australians to remain in the workforce longer and better aligns with rising life expectancies.
Limits on Lump Sum Withdrawals
Previously, retirees could withdraw their entire super balance as a lump sum. Under the new rules, lump sum withdrawals are now capped at 50% of your balance upon reaching preservation age. The rest must be drawn via regular income streams.
Mandatory Phased Withdrawals
Retirees will now be required to withdraw their funds through an account-based pension or similar income stream, replacing the optional nature of phased withdrawals.
This ensures a steady income throughout retirement and reduces the likelihood of prematurely exhausting savings.
Deferred Access Incentive
A new Deferred Access Bonus provides a 3% annual bonus to your super balance for each year you delay accessing it after reaching preservation age, up to a maximum of age 75.
This incentivizes Australians to leave their funds untouched for longer and accumulate more retirement capital.
Stricter Early Access Criteria
Access to superannuation before preservation age due to financial hardship or medical issues will now require stricter documentation and will be subject to withdrawal limits. This change aims to preserve funds for retirement purposes only.
Summary of Rule Changes
| Feature | Before June 1, 2025 | After June 1, 2025 |
|---|---|---|
| Preservation Age | 60 years | Increasing to 70 (by 2030) |
| Lump Sum Withdrawals | Up to 100% of balance | Capped at 50% of balance |
| Phased Withdrawal (Pension) | Optional | Mandatory |
| Deferred Access Bonus | Not available | 3% per year (up to age 75) |
| Early Access Rules | Flexible and uncapped | Tighter eligibility + capped amount |
Planning Ahead: What You Should Do
- Review your retirement timeline based on your birth year and the rising preservation age.
- Plan income streams rather than relying on full lump sum access.
- Consider deferring access if financially possible to gain the 3% annual bonus.
- Update financial records to meet early access verification if needed.
- Consult your fund provider to understand how the new rules affect your current super setup.
The new super withdrawal rules taking effect from June 1, 2025 mark a shift toward more sustainable retirement income planning.
With limits on lump sums, mandatory phased withdrawals, and incentives for delayed access, these changes aim to protect Australians from depleting their retirement savings too quickly.
Whether you’re years away from retirement or already planning your drawdown strategy, staying informed and adjusting your approach now will help ensure long-term financial security.
FAQs
Can I still access my full superannuation at retirement?
No, you can now only withdraw up to 50% as a lump sum. The rest must be drawn through an income stream.
Will the preservation age increase affect me immediately?
Not immediately for everyone. The increase is gradual, depending on your date of birth, and will reach age 70 by 2030.
What is the benefit of delaying superannuation access?
You’ll receive a 3% annual bonus to your super balance for each year you delay access after your preservation age, up to age 75.