In the last column of So Super we examined two basic components of membership of MSBS – the member benefit and the employer benefit.

If you resign from the ADF before turning 55, you can immediately take a lump sum payment of your member benefit up to the amount that had accrued (including interest) at June 30, 1999.

The balance – anything accruing after that date, must remain compulsorily preserved, either in the fund (as a number of units) or in a rollover fund.

This means members who joined after July 1, 1999, must preserve their entire member benefit.

Contrary to common belief, limitation on the amount of member benefit immediately accessible is not unique to MSBS.

Legislation introduced by the Government in 1998, actually means that compulsory preservation restrictions apply across the whole of the Australian superannuation industry.

Members have the option to roll their preserved member benefits over into another compliant superannuation fund at any time after discharge.

You can establish the amount of restriction that applies by referring to your most recent statement.

You can access your compulsorily preserved amount once you reach preservation age, provided you have left the workforce.

Preservation age differs from member to member according to the table at right.

The other part of your MSBS benefit, the employer benefit, must also be preserved in the fund at the time of your resignation. It can’t be rolled over.

The employer benefit, apart from the smaller productivity portion, grows at the rate of increases in the Consumer Price Index (CPI).

Productivity, expressed in units, will be paid out at the prevailing unit rate when claimed.

After leaving the workforce after 55, you can claim your employer benefit:

• entirely as a lump sum (provided you have reached your preservation age);
• as an indexed pension; or
• as a combination of both (where at least 50 per cent of the employer benefit is converted to pension).

Next column we’ll discuss benefit options on retirement.

MSBS preservation ages

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