The Australian dream of owning a home has become increasingly elusive for many, particularly as the housing market soars and the cost of living bites harder into our budgets.

However, a radical proposal from Liberal Senator Andrew Bragg could change the game for countless Australians struggling with mortgage repayments.

The suggestion? Allow Aussies to withdraw their entire superannuation balance to pay off their mortgage.

This bold idea is a response to the current housing affordability crisis and the rising cost of living, which is leaving many Australians feeling the pinch.

The Coalition had previously campaigned to allow first-time homebuyers to withdraw up to $50,000 from their super for a mortgage deposit.

However, Senator Bragg is pushing the envelope further, proposing that Australians be allowed to use their entire super balance to achieve the dream of home ownership sooner.

Senator Bragg proposes using superannuation to pay off mortgages. Credit: Shutterstock

The proposal comes as the average borrower has been shelling out an additional $19,000 annually on their mortgage since the Labor government took office in May 2022.

‘There are many Australians who have a decent-sized super balance that they would like to offset on their mortgage which would reduce their interest payments and get them closer to home ownership,’ Senator Bragg explained.

‘There's a range of ways this could be achieved from full withdrawal through to being held in a legislated offset account.’

‘One of the things that worries me is you've got people forced to pay high fees to their super fund and simultaneously pay high interest to a bank.'

Those in arrears or default have limited options, as current severe hardship rules restrict immediate access to superannuation funds.

Senator Bragg, the Opposition's home ownership spokesman, believes that the key to a successful retirement is not necessarily the size of one's superannuation balance but instead their home ownership status.

‘It's a highly rigid system. I just don't buy this idea that we have to force everyone into a straitjacket,’ he continued.

‘If the Bank of Mum and Dad is now going to be determining housing outcomes, we're in very dangerous territory.’

‘Increasingly, we're seeing housing outcomes dictated by parental wealth, and that's very bad. I'd say that's very un-Australian.’

‘Where super comes in, absent the Bank of Mum and Dad, this is likely to be people's biggest source of capital.'

He cited the example of a homeowner in their 40s with an average mortgage of $600,000, suggesting that using $200,000 from super to offset the loan could significantly reduce interest payments and fast-track the journey to outright home ownership.

The Senate Economics Committee is currently exploring this idea, with a report from the 'Improving consumer experiences, choice, and outcomes in Australia’s retirement system' inquiry expected soon.

An interim report has already floated the concept of a mortgage offset account linked to super, allowing borrowers to use their retirement savings for monthly repayments, thereby preserving their bank savings.

While the idea may seem attractive, especially to those feeling the squeeze of high mortgage repayments, it has its critics.

Labour has opposed early super access, arguing that it could deplete retirement savings and increase elderly dependence on the age pension.

The Reserve Bank's series of interest rate rises have only added to the urgency of finding a solution, with monthly mortgage repayments on an average of $600,000 loan jumping by 68 per cent.

The debate is set against the backdrop of a growing superannuation sector valued at $3.5 trillion, which the current government argues is essential for ensuring a dignified retirement.

Treasurer Jim Chalmers has expressed concerns that early access to super could harm long-term retirement savings.

‘The last decade saw the former government raid the superannuation system for its own purposes with a devastating impact on the savings of millions of Australians,' he said.

'Legislating an objective of super will help prevent this happening again.'

Senator Bragg, however, counters that the Labor government's ties to union-dominated industry super funds may be influencing their stance against exploring early super access.

'Labor doesn't care about the workers. What they care about are the donations they receive from unions and the super funds,' he replied.

‘The idea that super makes a massive difference to pension is false,’

‘For younger people who want individual agency, this is a practical policy,’

‘It's also a policy that helps protect the Budget over the longer term.’

In related news, a woman explained how Australians can receive a government contribution of up to $500 for their superannuation by making a personal after-tax contribution of $1,000.

The Super Co-contribution Scheme provides 50 cents for every dollar contributed, up to a maximum of $500, specifically for low—and middle-income earners. More information is available here.

Key Takeaways

• Liberal Senator Andrew Bragg suggests Australians should be allowed to withdraw their entire superannuation balance to help pay off their mortgages.
• The proposal comes as the opposition considers making this an election issue amidst rising mortgage costs and the cost-of-living crisis.
• A Senate economics committee is exploring the idea, and an inquiry report is expected soon. Discussions include allowing mortgage offset accounts linked to super funds.
• Labor opposes the early withdrawal of superannuation, arguing it would deplete retirement savings and increase dependency on the age pension.

What do you think about using your super to pay off your mortgage? Is home ownership the ultimate retirement security, or should super be preserved for later years? Share your thoughts and experiences in the comments below.

 

[Rain72]

Yes Luckyus, were where all these SDC members when super was introduced?? It was meant for nothing other than retirement,not a savings fund to buy anything.

Superannuation was introduced by reducing wage increases and tax cuts, so everyone had LESS money to spend on a home. It's a scam. It can NEVER fund retirement for battlers. And if paying into super deprives them of the money they need to buy a home, it's a bad deal. A home is far more beneficial in retirement.

 

[Rain72]

No one is hoarding anything
When the government I introduced super,it was for NO OTHER REASON THAN SAVING IT FOR RETIREMENT SO LESS BURDEN WITH LESS PENSIONERS.Since when has super "now let's see what we can do with it now idea".It was just that FOR RETIREMENT not to build the mcmansion,boat,2 cars,pool out the back compulsory and trip at least by yearly with family overseas

Super CANNOT EVER replace the pension, and if paying into super means people don't have access to enough income to buy a home, then they are going to be far WORSE OFF in retirement because of super. It's a stupid idea to suggest saving for retirement is more important than buying a home. It is making society worse off and putting a higher burden on taxpayers. Nobody is suggesting it should pay for a mansion (though it often does for retirees who manipulate by upgrading to a costly home on retirement so they can get the full pension!). But letting battlers access a little super to fund a decent deposit on a very modest home makes far more sense than forcing them to pay millions in rent and retire poor but with a few thousand extra in super than does NOTHING.
The system is so screwed up it's ridiculous. Young families are struggling to keep a roof over their heads but forced to throw hundreds every month into super and then on retirement they can pull all that super out, buy a luxury home and take a luxury trip around the world and get a full pension anyway. Yet when it's suggested that they be allowed to access super earlier to buy a modest home so they then CAN save more for retirement, people scream,

 

[Rain72]

I totally agree with everything you have said except that some humans are not cooperative and innovative,they r stupid and giving them access the some or all their super just assures us even more that in their retirement years,there will be more pensioners as they have already spent it in their younger years

If they are stupid, they will be pensioners in retirement anyway. For goodness sake, why can't we let the smart people manage their money the smart way - buying a home FIRST and THEN saving for retirement. Or do we really need to force all battlers into poverty just because SOME people are stupid?

 

[Rain72]

No one is hoarding anything
When the government I introduced super,it was for NO OTHER REASON THAN SAVING IT FOR RETIREMENT SO LESS BURDEN WITH LESS PENSIONERS.Since when has super "now let's see what we can do with it now idea".It was just that FOR RETIREMENT not to build the mcmansion,boat,2 cars,pool out the back compulsory and trip at least by yearly with family overseas

I don't think you read what I said! The burden on taxpayers is REDUCED by someone owning a home, not increased. Extra in super is NOT a benefit if paying rent. Nothing to do with mcmansions or 2 cars. It's about a roof over one's head without having to pay out nearly all of one's income in rent every week. A couple with $1 mil in super is likely to be drawing $50K a year. Rent where I live (NOT an expensive area) is average $700 per week. You try to get by on $13600 a year! And even before they retire, paying $700 pw rent, increasing every year, means they can't contribute more than the compulsory amount to super and they can't save.

The only other option a retired couple has after being denied the chance to buy a home earlier is to draw the full $1 mil and buy a home on retirement, leaving them with NOTHING (and most likely a mortgage!). If they had been allowed to draw a little of their super 5 years ago, they could have bought a good home for $500K and they would be well on the way to owning it AND growing their super as well.
This NONSENSE CRAP about super being ONLY for retirement is patently STUPID and increasing the burden on taxpayers. It isn't working, and it never will until people get their priorities right. The home should come FIRST. Then save for retirement.

 

[Rain72]

People ranting on about super being for retirement aren't thinking! You can buy six homes with super as long as you don't live in any of them. And the taxpayer will effectively subsidize your purchase with concessional tax rates on super.
You can also buy a home on retirement with super, using the whole damned lot if you wish, and then go on a full pension with concessions.
But goodness me, DO NOT let people do what is economically sensible and will reduce their reliance on the taxpayer in retirement by letting them access a little of their super earlier in life to get a foot on the property ladder. They might actually own a home before retirement and with the reduced accommodation costs they will enjoy, be able to put MORE money into super. They might even be able to downsize when they retire, reaping a profit on the sale of the home that has increased in value over the years, buying a cheaper home, and putting the difference into super or savings to reduce their reliance on the taxpayer.
But NO NO NO. We cannot let them do that!
Why? Are you all investors wanting to force people to pay you huge rents?
Most people would be FAR better off in retirement and less reliant on the taxpayer if allowed to use a portion of their super early in life to put a deposit on a very modest home.
As for the purpose of super - either the people who created the scheme are patently STUPID, or it was NEVER genuinely intended to fund retirement and reduce reliance on the pension. It's a wonderful tax dodge for the wealthy. Battlers will never accrue enough to fund their own retirement, and if it means they can't buy a home, they will be MORE dependent on taxpayers in retirement, not less.

 

[Luckyus]

Unfortunately Super came in a little late for some of us take full advantage of it's original purpose. However since successive governments have finally woken up to just how much is locked up in Super, it should by now be used for it's intended purpose that is funding your own retirement, but I think for any government that tries to that in will be surprised at the next elections.

 

[Luckyus]

Yes Luckyus, were where all these SDC members when super was introduced?? It was meant for nothing other than retirement,not a savings fund to buy anything.

Some of us were too old when it was brought in, as soon as I had a permanent I started paying off a Mortgage. I couldn't get a thirty year mortgage too old but still got caught up in 18/19% plus compound interest.

 

[Rain72]

Unfortunately Super came in a little late for some of us take full advantage of it's original purpose. However since successive governments have finally woken up to just how much is locked up in Super, it should by now be used for it's intended purpose that is funding your own retirement, but I think for any government that tries to that in will be surprised at the next elections.

A home is the most essential component for a comfortable retirement. To force people to lock up money in super when they can't afford a home is to RUIN their retirement completely. The folk who are comfortably retired, even without having super, are those who bought homes early in their lives and paid them off with plenty of time left to work and save.

 

[Phantom55]

As I understand, Super was bought to ultimately replace the age pension in effect you fund your own retirement without any assistance from government. Of course eventually they found out that were billions of dollars they couldn't touch, so then they started scheming on how they could their filthy on it. However If anybody can draw down on an amount for a mortgage, then I hope they stipulate that cash payment goes directly to the loan PRINCIPLE otherwise most of it will be lost on interest costs.

I do believe the money saved from rent savings would end up on overseas travel or luxury goods, vehicle,etc...remember the pink bats scheme...made a fortune for China with batts and big screen tvs and then allowed the electricity bills to accelerate to absorb the savings so made a lot of money for china and left everyone back where they started...The govt is just itching to get its hands on our super and this is only one way, once enough people sacrifice thier super for a house they will no longer have money to disqualify/reduce the pension which will result in more home owner pensioners, thus defeating the super system and opening the door to NOT exempt home owners from having thier home exempt from the pension(that will be the next step)

 

[Phantom55]

all houses today are a business..instead of paying tax buy a second house (Instead of paying tax, pay interest) the Tennant will pay the house off ,then start working on the next house courtesy of the tax office . rich get richer, turn your tax into a deposit on a house and Tennant will pay off ...one can retire at 45 very well off

 

[Rain72]

I do believe the money saved from rent savings would end up on overseas travel or luxury goods, vehicle,etc...remember the pink bats scheme...made a fortune for China with batts and big screen tvs and then allowed the electricity bills to accelerate to absorb the savings so made a lot of money for china and left everyone back where they started...The govt is just itching to get its hands on our super and this is only one way, once enough people sacrifice thier super for a house they will no longer have money to disqualify/reduce the pension which will result in more home owner pensioners, thus defeating the super system and opening the door to NOT exempt home owners from having thier home exempt from the pension(that will be the next step)

Nobody is talking about sacrificing super for a house. The proposal is to assist people to secure the MOST BENEFICIAL RETIREMENT AID THERE IS and the aid MOST LIKELY TO REDUCE RELIANCE ON TAXPAYERS IN RETIREMENT.
Superannuation is CRAP if you don't own a home. And anyway, you can drain the whole damned lot when you retire to buy a house at 10+ times what it would have cost you 20 years earlier. Wouldn't it be more sensible to let people buy it at the LOWER price and KEEP SOME SUPER, than forcing them to use the whole lot later on, after being kept poor for decades paying rent?

There is just no logic here. NONE! You let people get a home when they need it, it matters not what they spend the rent savings on. They HAVE A HOME to retire to, and all super accrued AFTER they get the home is saved for retirement, but retirement costs less because they have a home. The alternative you propose is screw them over for decades paying high rent then they spend 100% of their super on a home at a time when they cannot save anymore. Makes no sense to me! You are proposing we retain a scheme that guarantees more people on pensions and rent assistance and a much, much higher drain on the taxpayer to fund retirement.

 

[Rain72]

Can we please stop parroting nonsense without thinking and actually apply some logic?

Option 1: Let Bob and Mary (aged 30) access $200K of their super as a deposit on a modest home. Accommodation costs reduce over the next 37 years due to not paying ever-increasing rent. They CAN, if they wish, put more into super. We could even require them to repay some or all of the $200K with interest, starting, say at age 40 so the extra repayments aren't too much of a burden. By then their mortgage repayments as a percentage of income should be quite modest.
Worst case scenario, they have 37 years to pay into super for their retirement, and on retirement they have a home so their living costs are low. They could even potentially downize and put a lump sum into super to top it up. Regardless, they have 37 years of super contributions and growth to reduce or eliminate their reliance on the aged pension.

Option 2: Don't let Bob and Mary access super to buy a home. They pay crippling rent for 37 years. Then on retirement they draw a lump sum in super. The house they would have purchased for $500K at age 30 is now $2 mil, and that takes ALL their superannuation, and they go on a full pension with nothing to spare.

No matter how you choose to look at it, or how stupid you choose to think people are, it is always going to be better for people to buy a home than to have more in superannuation. ALWAYS. Restrict to a modest deposit on a modest home, certainly. Even make the drawing a loan repayable under certain conditions (carefully structured to not impose hardship).

Saying Super is for retirement is just parroting a stupid, thoughtless rant. Nobody is going to be better off in retirement for having remained homeless for decades, when a modest drawing could have put a permanent roof over their heads at much lower cost than renting and either having to buy much later, or drawing a pension PLUS rent assistance in retirement.

There are people out there who need help to buy a home and there is a proposal on the table that can deliver that help. Please STOP denying them the chance to secure their future. It's selfish. You are not benefiting taxpayers. You are benefiting greedy landlords at taxpayer expense. Forcing people to prioritize super savings over a home can only INCREASE the cost to taxpayers to fund retirement.

 

[Dynamo]

So you would rather the taxpayer fund rent assistance? Or fund a higher aged pension because people had to wait until retirement to buy a home at 10 times the price they could have purchased it if allowed to access some of their super sooner? Sorry, you are not making sense!
Nobody is asking any taxpayer to buy them a home. But taxpayers DO fund retirement for those who cannot fund their own. And I would hate to think that would ever change, because I don't want our elderly left to wallow in poverty or die of starvation. I am also a self-funded retiree, and grateful that I was able to save enough to achieve that status. But I have struggled and I know how tough it is for some folk, and I think it's far more important for them to have a home than a bundle of super money. And I can't see how it makes a difference to the taxpayer whether someone is helped to pay rent, helped to buy a home, or helped to fund retirement after using their super to get a home of their own. Those who earn too little to be able to get BOTH a home of their own AND retirement savings need taxpayer support, and that will never change while society benefits from having some workers provide their labour at low cost.

Very thoughtful reply. Thanks for posting.

 

[havingadoggyday]

People ranting on about super being for retirement aren't thinking! You can buy six homes with super as long as you don't live in any of them. And the taxpayer will effectively subsidize your purchase with concessional tax rates on super.
You can also buy a home on retirement with super, using the whole damned lot if you wish, and then go on a full pension with concessions.
But goodness me, DO NOT let people do what is economically sensible and will reduce their reliance on the taxpayer in retirement by letting them access a little of their super earlier in life to get a foot on the property ladder. They might actually own a home before retirement and with the reduced accommodation costs they will enjoy, be able to put MORE money into super. They might even be able to downsize when they retire, reaping a profit on the sale of the home that has increased in value over the years, buying a cheaper home, and putting the difference into super or savings to reduce their reliance on the taxpayer.
But NO NO NO. We cannot let them do that!
Why? Are you all investors wanting to force people to pay you huge rents?
Most people would be FAR better off in retirement and less reliant on the taxpayer if allowed to use a portion of their super early in life to put a deposit on a very modest home.
As for the purpose of super - either the people who created the scheme are patently STUPID, or it was NEVER genuinely intended to fund retirement and reduce reliance on the pension. It's a wonderful tax dodge for the wealthy. Battlers will never accrue enough to fund their own retirement, and if it means they can't buy a home, they will be MORE dependent on taxpayers in retirement, not less.

I read your post with interest and respect however I built out first home in1981,I was a stay at home through our choice,hubby a tradesman at local steelworks.You could choose to pay rent back then or pay a mortgage that for the biggest part was around $40k.Yes we lived on a fortnight's pay just to pay the mortgage for the month, and the other fortnight s pay was to.pay bills,groceries,petrol etc etc
Super was introduced in between all this,and your employer paid into your super,your portion wasn't as big.We managed to do both,I didn't work,my husband wasn't a rocket scientist,we paid off our house in 20 years which was the average bankloan, term aback then ,actually 25.By the time my husband was 60 he had enough super over $800 in super to retire early on,our home was paid off a d our kids grown and starting uni which we were then in a position to pay for them.Again,we were not rich,we just prioritised things and lived within our means.How people on our SDC site can say that they have no super to retire on and no home that they own is totally baffling to me.PS hubby didn't smoke gamble or drink(his choice)and he didn't have a Harley a d our holidays started when we were able to finance our own retirement at ,60.Worked for us so.I don't see why all the boohooing.Whats everyone done with their money since probably the age of 16 when most kids started working in the 60s and 70s???
I am truely baffled

 

[Rain72]

I read your post with interest and respect however I built out first home in1981,I was a stay at home through our choice,hubby a tradesman at local steelworks.You could choose to pay rent back then or pay a mortgage that for the biggest part was around $40k.Yes we lived on a fortnight's pay just to pay the mortgage for the month, and the other fortnight s pay was to.pay bills,groceries,petrol etc etc
Super was introduced in between all this,and your employer paid into your super,your portion wasn't as big.We managed to do both,I didn't work,my husband wasn't a rocket scientist,we paid off our house in 20 years which was the average bankloan, term aback then ,actually 25.By the time my husband was 60 he had enough super over $800 in super to retire early on,our home was paid off a d our kids grown and starting uni which we were then in a position to pay for them.Again,we were not rich,we just prioritised things and lived within our means.How people on our SDC site can say that they have no super to retire on and no home that they own is totally baffling to me.PS hubby didn't smoke gamble or drink(his choice)and he didn't have a Harley a d our holidays started when we were able to finance our own retirement at ,60.Worked for us so.I don't see why all the boohooing.Whats everyone done with their money since probably the age of 16 when most kids started working in the 60s and 70s???
I am truely baffled

Good for you. I could tell a very different story but one that shows equal discipline and common sense - and a bit of luck - and has a similar ending. But that's not everyone's story. There are folk who go into business and don't succeed and lose everything. There are folk who divorce and lose a lot in a split. There are folk who suffer serious illness or disability and can't earn, yet deal with massive health costs. There are folk who have children with serious disabilities or illness. There are folk who suffer loss in fires, floods, or tornadoes. There are folk who give up years of their working lives to care for aging parents or other loved ones in ill health. Some people had very limited opportunity to attain education or skills of any kind and suffered in very low-paid work with long periods of unemployment, despite trying hard to find work. My husband suffered a serious work accident and for reasons I don't care to expose, did not even try to get compensation. But others injured in the same workplace did sue for compensation and after legal costs and medical costs, ended up unable to work and with virtually nothing.
You say your husband didn't drink or smoke. Not all who do are just irresponsible. I know men who drank heavily to deal with chronic pain and/or mental suffering due to enduring shocking injustice and torment in childhood. I know men who drank heavily to forget the hell they endured in Vietnam. Some who take up smoking end up with an addiction that costs them a small fortune and find it very hard to quit. There are also those who get addicted to gambling in one form or another, and that's an illness. Addiction can be shockingly hard to overcome and while there is a lot of help available today, many struggled to find help in past years. Women have had to flee a bad relationship penniless, and try to start over.
Then there are folk who are just bad money managers. They just never learned how to prioritize, how to save, or how to live economically.

So do we simply tell these folk, ''Too bad, so sad. Others have done better so you don't deserve a chance to improve your situation''? If they are in a mind frame to take a step in the right direction and the opportunity presents, why should they be denied a second chance? Those who face these challenges are likely to retire on a pension anyway. Why not let them use some of their own superannuation money to establish themselves in a home as early as possible and hopefully need less taxpayer support in retirement?

 

[havingadoggyday]

Good for you. I could tell a very different story but one that shows equal discipline and common sense - and a bit of luck - and has a similar ending. But that's not everyone's story. There are folk who go into business and don't succeed and lose everything. There are folk who divorce and lose a lot in a split. There are folk who suffer serious illness or disability and can't earn, yet deal with massive health costs. There are folk who have children with serious disabilities or illness. There are folk who suffer loss in fires, floods, or tornadoes. There are folk who give up years of their working lives to care for aging parents or other loved ones in ill health. Some people had very limited opportunity to attain education or skills of any kind and suffered in very low-paid work with long periods of unemployment, despite trying hard to find work. My husband suffered a serious work accident and for reasons I don't care to expose, did not even try to get compensation. But others injured in the same workplace did sue for compensation and after legal costs and medical costs, ended up unable to work and with virtually nothing.
You say your husband didn't drink or smoke. Not all who do are just irresponsible. I know men who drank heavily to deal with chronic pain and/or mental suffering due to enduring shocking injustice and torment in childhood. I know men who drank heavily to forget the hell they endured in Vietnam. Some who take up smoking end up with an addiction that costs them a small fortune and find it very hard to quit. There are also those who get addicted to gambling in one form or another, and that's an illness. Addiction can be shockingly hard to overcome and while there is a lot of help available today, many struggled to find help in past years. Women have had to flee a bad relationship penniless, and try to start over.
Then there are folk who are just bad money managers. They just never learned how to prioritize, how to save, or how to live economically.

So do we simply tell these folk, ''Too bad, so sad. Others have done better so you don't deserve a chance to improve your situation''? If they are in a mind frame to take a step in the right direction and the opportunity presents, why should they be denied a second chance? Those who face these challenges are likely to retire on a pension anyway. Why not let them use some of their own superannuation money to establish themselves in a home as early as possible and hopefully need less taxpayer support in retirement?

 

[havingadoggyday]

Dear rain72 thankyou for reading my post and your very well written response,but while I feel very very sorry for the cases and people you have mentioned and the various scenarios that life throws at us,I would like to say,that like you, there are things we don't wish to discuss on thep forum as are very very personal.I do know what it's like to have someone in family disabled by illness and unable to work,to have grandchildren so disabled that they can't even attend special schools at nearly 10 years old,I do know what it's like to have a female divorce with an abusive husband at a time in her life when she should have been enjoying the fruits of their labour a d needed to start at half way again,yes there are people that are drinks because of life's beatings and people with gambling addictions,BUT this is not the people that this article was written about.These people don't have super to withdraw and buy a house with to start off with,a gambler that won't have money in super because he has a disease and gambled it away,will not have money in super to access to buy a home and if he or she did,could you trust that they would use it to buy a house?or fe d their sad addiction???I am not saying I did the write thing and why haven't you,I am saying in response to all other posts,if a couple can have $400K in super and why can't they access it to buy a home early.....if you have that kind of money in super at that young age,you must be earning decent money,what have you done with it.If you are at pension age and saying that it's only then that you can access it to buy a home but now it's too dear and will be left on a pension,again,you must have earned money to.pay rent all your life from ages 16-65(regular Aussie born then)you obviously did earn money...what did you do with it???.

Whilst I personally have experienced many of the sad situations you discussed,again,without going into.painfull detail,THESE are not the people being discussed by this forum and some areas of government that want young people taking out their super to buy a house,the people you have discussed won't have much if any super,or savings and if not already living on government pensions of one sort or another ,will probably be in retirement anyway.Again,these are NOT the people targeted in this articles to be allowed access to empty super accounts to buy homes.Many thanks for reading

 

[Rain72]

Dear rain72 thankyou for reading my post and your very well written response,but while I feel very very sorry for the cases and people you have mentioned and the various scenarios that life throws at us,I would like to say,that like you, there are things we don't wish to discuss on thep forum as are very very personal.I do know what it's like to have someone in family disabled by illness and unable to work,to have grandchildren so disabled that they can't even attend special schools at nearly 10 years old,I do know what it's like to have a female divorce with an abusive husband at a time in her life when she should have been enjoying the fruits of their labour a d needed to start at half way again,yes there are people that are drinks because of life's beatings and people with gambling addictions,BUT this is not the people that this article was written about.These people don't have super to withdraw and buy a house with to start off with,a gambler that won't have money in super because he has a disease and gambled it away,will not have money in super to access to buy a home and if he or she did,could you trust that they would use it to buy a house?or fe d their sad addiction???I am not saying I did the write thing and why haven't you,I am saying in response to all other posts,if a couple can have $400K in super and why can't they access it to buy a home early.....if you have that kind of money in super at that young age,you must be earning decent money,what have you done with it.If you are at pension age and saying that it's only then that you can access it to buy a home but now it's too dear and will be left on a pension,again,you must have earned money to.pay rent all your life from ages 16-65(regular Aussie born then)you obviously did earn money...what did you do with it???.

Whilst I personally have experienced many of the sad situations you discussed,again,without going into.painfull detail,THESE are not the people being discussed by this forum and some areas of government that want young people taking out their super to buy a house,the people you have discussed won't have much if any super,or savings and if not already living on government pensions of one sort or another ,will probably be in retirement anyway.Again,these are NOT the people targeted in this articles to be allowed access to empty super accounts to buy homes.Many thanks for reading

And thank you for your thoughtful reply. But the fact is that there are a great many out there who DO have super (because it is compulsory for their employer to pay it) and yet have not been able to save a home deposit. Or have suffered a crisis and lost their savings or investments.

One family I know well is in that situation now - with hundreds of thousands in super but not enough deposit for a home, because of a crisis. And limited future earning power due to health issues. In that case, help from their family enabled them to get a very modest home, but with a high debt. Their super will pay out the balance of the loan on retirement and they will be on a part pension for quite a while until their super depletes further. Had they not been able to buy a home now, they would spend all their super on a house on retirement and have nothing left. And the next few years would be incredibly hard, paying rent instead of paying off a home of their own.

Back when only employees in certain areas had super and it was paid out on leaving the job, my husband cashed his quite minimal amount of super to fund a home deposit. We might never have acquired a home otherwise. Certainly, it would have taken much, much longer and made life a great deal harder, and we would be nowhere near as well off today. He was moving to a much lower-paid job and we had a child with special needs imposing huge medical costs. That cash was a godsend! It put us on our feet.

Gamblers, drinkers and spendthrifts often have good jobs and superannuation, but can't save. People whose homes were flooded or burnt to the ground may well have super, but insufficient insurance to start over. People who have an accident or fall very ill or have a child who is very ill or disabled might well have accrued a fair amount of super, but face reduced income and high expenses going forward.

I do agree that it would be very risky to let people access super without tight controls. That's why I propose access be limited to folk who can show genuine need and are buying a very modest home, and can demonstrate that the money is going exclusively to the house. And I would support the idea that the money is a loan from the super fund, repayable under certain conditions structured to ensure there is no risk of hardship. I would also support allowing people access to super to prevent the loss of a home, again provided there were very tight controls.

I don't think it's reasonable to make assumptions about other people's situation. Yes, they may APPEAR to have had opportunities they didn't take advantage of, but neither you not I necessarily know their circumstances. And maybe they DID waste money. Maybe they have just now realized they were foolish and decided that if they can just get a big of a start to buy a home, they can do better going forward. Should we deny them that chance, when it's THEIR MONEY they are asking to use in a responsible manner?

The bottom line is that it IS THEIR MONEY. It's not the taxpayer's. It's theirs. And it is wrong that they cannot use it in the manner that is going to deliver the best retirement outcome for them.

 

[Rain72]

Dear rain72 thankyou for reading my post and your very well written response,but while I feel very very sorry for the cases and people you have mentioned and the various scenarios that life throws at us,I would like to say,that like you, there are things we don't wish to discuss on thep forum as are very very personal.I do know what it's like to have someone in family disabled by illness and unable to work,to have grandchildren so disabled that they can't even attend special schools at nearly 10 years old,I do know what it's like to have a female divorce with an abusive husband at a time in her life when she should have been enjoying the fruits of their labour a d needed to start at half way again,yes there are people that are drinks because of life's beatings and people with gambling addictions,BUT this is not the people that this article was written about.These people don't have super to withdraw and buy a house with to start off with,a gambler that won't have money in super because he has a disease and gambled it away,will not have money in super to access to buy a home and if he or she did,could you trust that they would use it to buy a house?or fe d their sad addiction???I am not saying I did the write thing and why haven't you,I am saying in response to all other posts,if a couple can have $400K in super and why can't they access it to buy a home early.....if you have that kind of money in super at that young age,you must be earning decent money,what have you done with it.If you are at pension age and saying that it's only then that you can access it to buy a home but now it's too dear and will be left on a pension,again,you must have earned money to.pay rent all your life from ages 16-65(regular Aussie born then)you obviously did earn money...what did you do with it???.

Whilst I personally have experienced many of the sad situations you discussed,again,without going into.painfull detail,THESE are not the people being discussed by this forum and some areas of government that want young people taking out their super to buy a house,the people you have discussed won't have much if any super,or savings and if not already living on government pensions of one sort or another ,will probably be in retirement anyway.Again,these are NOT the people targeted in this articles to be allowed access to empty super accounts to buy homes.Many thanks for reading

And one more thing. While Fred and Mary Battler are unable to draw from super to fund a house deposit, Jack Rich is able to draw from super to buy an investment property to rent to Fred and Mary Battler at a crippling rent rate, claiming not just superannuation tax concessions but also all the lovely tax benefits of being a property investor. Then, in 20 years, when Fred and Mary Battler retire, they can buy that house from Jack Rich at 10+ times the price he paid for it, after having paid it off for him over 20 years of paying high rent. But that's okay, because Jack Rich won't ever need a pension under any circumstances. With all the huge superannuation and investor tax benefits he enjoys, he's drawn way more in tax concessions than any aged pensioner will ever draw in pension income. But we cannot allow Fred and Mary Battler to access THEIR money to buy a home.

Maybe the real reason is because that would deprive Jack Rich of profit? See, the Labor Party is very good at telling nice-sounding stories that are very believable (""Superannuation is for retirement, so we don't have to pay aged pensions."), while hiding their real objective, which is actually to feed the wealthy and keep the battlers down. We were all taught they were the party for the worker. It's not so at all!

 

[havingadoggyday]

And thank you for your thoughtful reply. But the fact is that there are a great many out there who DO have super (because it is compulsory for their employer to pay it) and yet have not been able to save a home deposit. Or have suffered a crisis and lost their savings or investments.

One family I know well is in that situation now - with hundreds of thousands in super but not enough deposit for a home, because of a crisis. And limited future earning power due to health issues. In that case, help from their family enabled them to get a very modest home, but with a high debt. Their super will pay out the balance of the loan on retirement and they will be on a part pension for quite a while until their super depletes further. Had they not been able to buy a home now, they would spend all their super on a house on retirement and have nothing left. And the next few years would be incredibly hard, paying rent instead of paying off a home of their own.

Back when only employees in certain areas had super and it was paid out on leaving the job, my husband cashed his quite minimal amount of super to fund a home deposit. We might never have acquired a home otherwise. Certainly, it would have taken much, much longer and made life a great deal harder, and we would be nowhere near as well off today. He was moving to a much lower-paid job and we had a child with special needs imposing huge medical costs. That cash was a godsend! It put us on our feet.

Gamblers, drinkers and spendthrifts often have good jobs and superannuation, but can't save. People whose homes were flooded or burnt to the ground may well have super, but insufficient insurance to start over. People who have an accident or fall very ill or have a child who is very ill or disabled might well have accrued a fair amount of super, but face reduced income and high expenses going forward.

I do agree that it would be very risky to let people access super without tight controls. That's why I propose access be limited to folk who can show genuine need and are buying a very modest home, and can demonstrate that the money is going exclusively to the house. And I would support the idea that the money is a loan from the super fund, repayable under certain conditions structured to ensure there is no risk of hardship. I would also support allowing people access to super to prevent the loss of a home, again provided there were very tight controls.

I don't think it's reasonable to make assumptions about other people's situation. Yes, they may APPEAR to have had opportunities they didn't take advantage of, but neither you not I necessarily know their circumstances. And maybe they DID waste money. Maybe they have just now realized they were foolish and decided that if they can just get a big of a start to buy a home, they can do better going forward. Should we deny them that chance, when it's THEIR MONEY they are asking to use in a responsible manner?

The bottom line is that it IS THEIR MONEY. It's not the taxpayer's. It's theirs. And it is wrong that they cannot use it in the manner that is going to deliver the best retirement outcome for them.