The COVID-19 (Coronavirus) pandemic is creating challenges for the entire community. Many individuals, families, and small and large businesses have been impacted financially. If you’ve been affected by job loss or a decrease in wages, your business revenue has been affected or you’ve been forced to close, the Government’s recent financial relief measures may help.
With daily news updates and changes to policies, it’s not easy to know what financial support is available to you, and how you can access it. Here’s an overview of some relief measures currently in place to help affected workers, businesses and the broader community.
What financial relief is available for individuals?
The Australian Government is providing financial relief to Australians to support them through COVID-19. This relief focuses on 3 main areas: income support payments, payments to support households and temporary early release of superannuation.
Income support payments
Over the next 6 months, the Government is temporarily expanding eligibility to income support payments and establishing a new, time-limited Coronavirus supplement to be paid at a rate of $550 per fortnight.
This will be paid to both existing and new recipients of the:
The Government is providing two separate Economic Support Payments – of $750 each – to social security, veteran and other income support recipients and eligible concession card holders. The first payment will be made from 31 March 2020 and the second payment will be made from 13 July 2020.
If you’ve lodged a claim for an eligible payment, for example, the Age Pension, Veteran Service Pension, JobSeeker Payment, Youth Allowance Jobseeker, you’ll automatically receive this payment via Services Australia or the Department of Veterans’ Affairs. To see the full list of who’s eligible, and find out more, refer to the factsheet.
If you’re experiencing financial hardship during the COVID-19 pandemic, there are a range of support options available. Some of these are outlined below.
Help paying bills, loans, your mortgage
For those having trouble paying bills, loans or your mortgage, you should speak to your financial institution or energy and utilities provider directly. Many banks, for example, are providing different forms of support during the COVID-19 pandemic. This includes:
Deferring repayments on loans (often up to 6 months on mortgages)
Providing financial hardship services.
If you’re finding it hard to pay the rent because you’ve been impacted by the COVID-19 pandemic, your first port of call should be to get in touch with your landlord to discuss a payment plan. Justice Connect, a Victorian legal advocacy service, has developed a Dear Landlord tool to help you construct a letter.
Tenancy rights and advice varies from state-to-state, so be sure to explore the latest information that’s relevant to the state you live in:
The Government is allowing early access to super savings for people financially affected by Coronavirus (COVID-19). If eligible, you can access up to $10,000 of your superannuation before 1 July 2020, and a further $10,000 from 1 July 2020 to 31 December 2020.
To apply for early release of your super, you must be:
Eligible to receive a JobSeeker Payment, Youth Allowance Jobseeker, Parenting Payment (which includes the single and partnered payments), Special Benefit or Farm Household Allowance
Made redundant or your working hours were reduced by 20% or more since 1 January 2020
A sole trader and your business was suspended or your turnover has reduced by 20% or more since 1 January 2020.
If you meet these requirements, you won’t pay tax on any super you withdraw and it won’t affect Centrelink or Veteran’s Affairs payments.
Before accessing your super, there are several important things to consider, such as the impact it may have on your retirement, as well as any insurance cover you have through your super.
indicates that a 25 year old who withdraws $20,000 could have $64,400 less super by the
time they retire1.
Taking out money now could
have a significant impact on your retirement lifestyle. That’s why it’s
important to make sure you are accessing all the other forms of financial
support you can.'
The potential impact on individuals of withdrawing super early
Potential reduction in
Retirement Balances (in today's dollars)
Source: Estimates by
individual ages as specified, retires at 67, withdraws $10,000 this financial
year and $10,000 next financial year from their super, long term investment
returns of 6.5%pa net of investment fees and taxes. The results are expressed
in today’s dollars discount at wage inflation of 3.5%pa.The case study is
provided for illustration purposes only and isn’t a representation of the
actual benefits that may be received or the fees and costs of a particular
financial product. Investment returns are not guaranteed
Accessing your super early could also affect your insurance cover. Insurance is an important part of most members’ overall financial security. If you want to maintain your insurance cover, check you have enough money in your super account to pay the cost after accessing your super.
Accessing your super early should be an informed decision
It’s important you’re aware of all your options and think about your short and long-term financial needs. We encourage members to make informed decisions about their finances, look at their personal financial situations as a whole and make a decision that best supports their overall needs.
Some state governments are launching initiates to help people find new work. For example, the Victorian Government have launched a new scheme called Working for Victoria. This launched on 17 April 2020, and aims to help Victorian’s find new work opportunities
Check with your local government to see where they could assist.
What financial relief is available for businesses?
If you manage, own or run a business which has been affected by a loss in revenue, you’ve had to let staff go, or are considering your options, it helps to be clear on what’s available specifically for businesses.
In addition to the financial relief and support services listed above, different states and businesses may have new schemes launching to help those affected which address the most recent changes COVID-19 brings.
Researching the latest news on financial support from government and state websites such as MoneySmart, and also banking websites such as bausbanking.com.org.au may help you stay up to date with the latest help available.
AustralianSuper. Assumptions: member ages as specified, retires at 67,
withdraws $10,000 this financial year and $10,000 next financial year from
their super, long term investment returns of 6.5%pa net of investment fees and
taxes. The results are expressed in today’s dollars discount at wage inflation
of 3.5%pa.. The case study is provided for illustration purposes only and isn’t
a representation of the actual benefits that may[JH1] be received or the fees and costs of a particular
financial product. Investment returns are not guaranteed.
Past performance is not a reliable indicator of future returns.
This information may be general financial advice which doesn’t take into account your personal objectives, situation or needs. Before making a decision about AustralianSuper, you should think about your financial requirements and refer to the relevant Product Disclosure Statement available at australiansuper.com/pds. AustralianSuper Pty Ltd ABN 94 006 457 987, AFSL 233788, Trustee of AustralianSuper ABN 65 714 394 898.