Second-time superannuation dippers surge to more than a million

The number of coronavirus-affected Australians hoping to dip into their retirement savings for a second time has surged to more than 1 million, new data from the Australian Prudential Regulation Authority (APRA) shows.

This is a jump of more than 200,000, or some 30 per cent, in the span of two weeks, between July 12 and July 26. 

Second-time requests to withdraw from superannuation added up to $8.9 billion since the second round of the early release scheme began on July 1.

Repeat applications account for more than a quarter of all requests to access superannuation early, with the Australian Taxation Office (ATO) clocking up 3.98 million applications in total from April 20, when the scheme began, to July 26.

Double-dippers have applied to take out an average of $8,547.

However, the number of applications and actual payments have slowed as the scheme enters its 14th week. About $1.4 billion of super payments were handed out to Australians in the week to July 26, down from more than $6 billion in the week to July 12.

The ATO received 140,000 requests to dip into retirement savings in the week to July 26, compared with 581,000 applications two weeks prior.

But the number of repeat applications continue to trump the number of first-time applicants, with 57 per cent, or 81,000 requests, from those claiming for a second time.

First-time withdrawers make up three quarters of applicants 

In March, the federal government allowed eligible Australians, who had lost their jobs or had their incomes reduced, to access a total of up to $20,000 from their super. Workers could apply to take out a maximum of $10,000 in the first round before the end of the 2019-20 financial year, and up to another $10,000 in the second round this financial year.

Many financially struggling Australians have tapped the opportunity to maximise their withdrawal by double-dipping into their super.

Not everyone has rushed to max out their super withdrawal limits. More than 2.9 million workers, or three quarters of applicants, requested to take out their retirement savings for the first time, worth a total of $21.8 billion, since the start of the scheme.

In total, Australians have asked to pull a combined $30.7 billion from their nest eggs, with $29.4 billion in payments handed out in 3.8 million payments. The average payment amount made overall is $7,705.

These new numbers have surpassed the Treasury’s original projection that 1.7 million workers would access $29 billion of their super.

More than 71,000 applications were closed or revoked.

What to know if you’re considering a super withdrawal

In late July, the government extended the application deadline from September 24 to December 31 for those struggling financially and planning to draw from their retirement savings.

If you’re thinking about what to do with your super, remember you have about five months until the deadline. Depending on your circumstances, you may want to consider all your other options before deciding to pull out cash from your super. With the government pumping out billions in stimulus packages and banks prepared to help customers in hardship, there could be financial support out there that you may be able to access. 

Keep in mind that the money in your super fund is your retirement savings, and taking out thousands of dollars could affect how much you have left when you retire. Before making any superannuation or retirement-related decisions, consider speaking with a financial adviser. 

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