2026 General Seminar - Roger Wilkins (Melbourne Institute)

Title: How valuable is liquidity in private retirement plans? Impacts from raising the superannuation access age 

by  Marc Chan, Cain Polidano, Lan Tong, Ha Vuc, Roger Wilkins and Son Nguyen

Abstract:  A key issue in the design of private retirement plans is the extent of liquidity before retirement age. We provide first empirical estimates from a policy reform, utilising stepwise increases in access age from 55 to 58 by birthdate in Australia, using administrative data and a regression discontinuity design. We estimate small reductions in withdrawals, no employment response and reductions in contributions that point to early access being a valuable source of precautionary liquidity, especially for groups that are typically ‘highly engaged’ financially. Overall, restricting pension liquidity ahead of normal retirement age is found to make little difference to retirement savings.