People should draw down on their superannuation to pay bills during the coronavirus crisis only as a last resort, consumer advocates say.

Super Consumers Australia, a division of consumer advocacy group Choice, says drawing down the maximum $20,000 over two years, allowed under new rules introduced by the Morrison government on Sunday, will cost about $50,000 in retirement income, or about a year’s worth.

The super fund that covers the virus-battered hospitality and entertainment sectors, where workers are being laid off in droves due to the crisis, estimates losses could be even higher.

Industry fund Hostplus says that $20,000 withdrawn by a 25-year-old would have swelled to $132,000 by age 67.

Under the new rules, workers whose income is reduced by at least 20% due to the Covid-19 outbreak are allowed to take $10,000 out of their super between mid-April and June 30 and another $10,000 in the three months after that date.

In addition to raising concerns that hard-up members will drain their super at the expense of their retirement income, the proposal has also sparked worries that super funds will be forced to sell assets to fund the drawdowns.

Labor opposed the proposal, but has committed to support the survival package of which it is a part.

“Selling your super at the bottom of the market will risk squandering people’s hard-earned retirement savings,” the opposition leader, Anthony Albanese, told parliament on Monday.

“It is also the case if the superannuation industry is forced to sell assets at the bottom of the market. That also is not sensible economics.”

Industry Super Australia, which represents the union-and-employer-controlled industry super sector, said it was not consulted on the move.

“This is an issue that must be handled very carefully in order to prevent the compounding of liquidity pressures that may be faced by superannuation funds in the current market conditions, and as they support anxious members,” the chief executive, Bernie Dean, said.

Super Consumer Australia director Xavier O’Halloran said $30,000 was “about what the average couple would live on in retirement”.

“I’d really weigh the options and look at it as a last resort,” he said.

He said some people might need to take the money in order to avoid becoming homeless or to feed their families, and could still rely on the pension when retired.

“If you’re going to be kicked out of the house because you can’t pay rent or you can’t buy food for your family, these things can lead to things that are far worse than losing a few years of income in retirement,” he said.

The Hostplus CEO, David Elia, said the drawdowns would not cause his $45bn fund to freeze.

“We are sitting on billions of dollars in cash and billions of dollars in listed equities,” he said.

“It should also be recognised that whilst global equity markets have declined in recent months, the falling Australian dollar has also lifted the value of those international holdings.”

Both ISA and Hostplus said the super drawdowns would put pressure on fund systems because they had to be manually processed.

“There are also other broader considerations for the entire superannuation industry that we have to consider, including the impact on an already stressed system dealing with current member queries relating to the recent investment market volatility and the consequential reduction in member account balances,” Elia said.

“Many funds are already at full capacity dealing with member inquires.”