Q: I work for the government and I belong to the PSS scheme (a public sector super fund). My question is, can I pay my superannuation into my mortgage and then receive the Age Pension? I am over 55.
Trish’s response: Before I answer the main part of your question, please note that the Age Pension is only available to those who have reached Age Pension age (65 for men and currently 63.5 years for women, and moving to 64 years for women from January 2010).
Generally speaking, once you withdraw your super benefits from a super fund as a lump sum (assuming you have satisfied a condition of release – see article 12 legal ways to access your super benefit), what you do with that cash payment is your business.
If you choose to cash out all of your super benefits, spend all the cash, and then claim the Age Pension (known as ‘double dipping’), then the super rules don’t stop you. Repaying outstanding debts with your super benefits is probably a more legitimate version of the ‘double dipping’ strategy.
If you’re considering such a strategy, note that you must satisfy a Centrelink income test and assets test, although an individual’s home is exempt from the assets test.
Note: My understanding is that the PSS scheme offers several benefit payment options including an indexed lifetime pension. I suggest you thoroughly research all of your payment options, including the tax implications of different options, before making any decisions.
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Hi - I'm Trish Power and I am the author of 
Looks like you will be working for another 10 years.
After reading your question the first thing that came to mind was a 50/50 strategy.
Will I have enough super at age 65 to take a 50/50 super payout, use the cash component to pay off my debt and take the rest as a indexed pension – for life. I also need to find out how Centrelink will treat my PSS pension, it’s likely they will exclude 1/3 or maybe even 50% when doing the A&I tests which could result in an additional two or three bucks a fortnight.
I turn 62 this weekend (LOL) and have been a member of a state defined benefit fund for 33/34 yrs and employed in Education. Been planning for retirement for a couple of years now and soon realized it was going to be a DIY project. I choose to use only a reputable accountant and stay away from the rest. Like you my super is good so nothing to do here. For our savings we setup a SMSF and use only term deposits with a regional bank. Next July I will take a 50/50, cash will go in the SMSF and the interest earned plus pension will give us a guaranteed income for a comfortable retirement as per Westpac-ASFA.
Cheers