First Home Super Saver: questions the media forgot to ask

First Home Super Saver: questions the media forgot to ask

First Home Super Saver Scheme has generated quite a few debates within the FHB’s as well as other parts of the communities (the haves and the have not’s). There are still many unanswered questions. So we got in touch with the government budget people again for answers.

 

Would you be able to withdraw from the First Home Super Saver Scheme?

This is an important consideration before making any contributions to the First Home Super Scheme. Why? Because what if halfway through you have an emergency (what you call an ’emergency’ may not be what the government call it compassionate grounds). Which means contributors may need access to these contributions.

Or what if property prices are still out of reach? or find a bargain investment property or stock on the ASX that they would rather invest in. What happens then?

Q. Would the contributors be able to withdraw from the FHSSS (First Home Super Savers Scheme) for any other reason other than for the purpose of a live in property?

Examples:

– Can the contributors purchase an investment property?

– Can the contributions be withdrawn for a medical emergency?

 

Response from the Department of Treasury (unedited)

You asked if contributors to First Home Super Saver Scheme will be able to use the money for any other reason other than the purpose of a live in property, for instance for the purchase an investment property.

Because the First Home Super Saver Scheme has not yet been legislated, it is not possible to be definitive in answering your question. As part of the normal process for progressing measures announced in the budget, the Government will be working through the detailed design issues in the course of developing the legislation.

You also asked if contributions can be withdrawn for a medical emergency.

Benefits may be released on compassionate grounds only in very limited circumstances.  These circumstances are defined in regulations and cover expenses in respect of medical treatment, medical transport, modifications necessary for the family home or motor vehicle due to severe disability, palliative care, and funeral expenses.  Funds may also be released on compassionate grounds to prevent foreclosure of a mortgage or exercise of a power of sale over the member’s principal place of residence.  Benefits can also be released to meet expenses in other cases where the release is consistent with one of these grounds.

The Department of Human Services is responsible for the early release of superannuation benefits on compassionate grounds.  More information is available by calling the department on 1300 131 060 or by visiting https://www.humanservices.gov.au/customer/services/centrelink/early-release-superannuation.

 

The above link just basically explains who can apply for compassionate grounds:

To get your super released early you must:

  • meet a compassionate ground
  • be in severe financial hardship
  • have a terminal illness
  • have less than $200 in super
  • be a temporary resident leaving Australia for good

Actually, this is an interesting topic altogether and we will write more about this later on.

What if the contributor had purchased an investment property before?

This is a very common question from many Rentvesters. So we had a crack at it.

Q. Would a contributor who has already purchased an investment property be eligible for the First Home Super Saver Scheme?

Q. If the above answer is ‘no’ then what if the situation is that this investment property is now sold. Would this mean that the contributor will be eligible for the FHSSS?

Then the Department of Treasury came back with (unedited)

You asked whether someone who has already purchased an investment property would be eligible for the First Home Super Saver Scheme?

Because the First Home Super Saver Scheme has not yet been legislated, it is not possible to be definitive in answering your question.  As part of the normal process for progressing measures announced in the budget, the Government will be working through the detailed design issues in the course of developing the legislation.

Okay, so I guess there are not much information to go by here. But this is the best we could do given that no one seems to be able to give is a binary answer to most questions until government works through the detailed design.

We at LoanDolphin promise to cover more and decrypt all this as it happens.

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