MAXIMISING YOUR RETIREMENT BENEFITS
Working out your retirement budget can be a tricky business. The good news is that there a range of government payments and other benefits that can help your nest egg stretch further.
After working hard for so many years, naturally you want your retirement to be as comfortable and enjoyable as possible. That’s why it’s worth knowing which types of government support you may be entitled to when you’re transitioning into this new phase of life.
If you’ve been putting money into super throughout your working years, this is likely to be your main source of income when you retire. However, you might also be able to access other allowances and concessions that can help you reduce your living costs.
And let’s face it – when you’re a retiree, every dollar counts. With this in mind, let’s take a look at some of the main government benefits on offer.
Age Pension Once you reach age pension age (between 65 and 67 depending on your date of birth), you can apply for the Age Pension if your income and assets don’t exceed certain levels. Depending on your financial situation, you could be eligible to receive a full or partial Age Pension from the federal government.
There are different income and assets test thresholds for singles and couples, as well as for homeowners and non-homeowners under the assets test.
Under the assets test, if the value of your assets (not including your home) is below the lower threshold, you could receive a full pension – and if it’s between the two thresholds you may be eligible for a partial pension. However, if you’re above the upper threshold, you won’t receive any pension at all.
These thresholds1 are currently:
• Single homeowner: $253,750 to $552,000
• Single non-homeowner: $456,750 to $755,000
• Couple homeowner: $380,500 to $830,000
• Couple non-homeowner: $583,500 to $1,033,000
Your income (eg. if you’re still working) may also reduce the value of your pension. As a single pensioner, you can earn up to $168 a fortnight without it affecting your pension entitlement.
A couple can earn a combined fortnightly income of $300. Every dollar you earn above these thresholds will reduce your fortnightly pension by 50 cents. Your age pension is the lower of the assets test and income test calculation.
On top of the Age Pension, you may also be able to access additional government payments, such as:
• Carer allowance – if you give daily care to an elderly person or someone with a disability or serious illness.
• Rent assistance – to help cover your rent if you receive an eligible government benefit and are renting privately.
• Energy supplement – to help manage household costs if you receive an eligible income support payment.
Affordable health care
Even if you’re not eligible for the Age Pension upon reaching age pension age, you can still get a Commonwealth Seniors Health Card – as long as your annual income is less than $53,799 for singles and $86,076 for couples.
This card offers reduced cost medicines under the Pharmaceutical Benefits Scheme, bulk billing for doctor’s appointments and cheaper out of hospital medical expenses through the Medicare safety net.
Other discounts and concessions for seniors
You can apply for a Seniors Card once you reach 60 (or 65 for Queenslanders), as long as you’re working the required number of hours a week and you’re a permanent resident of your state. With your Seniors Card, you’ll get exclusive offers and significant discounts on a range of different services, as well as holidays and entertainment.
Different businesses in each state offer Seniors Card discounts. To find out what you’re eligible for, check the government website for your state or territory, or look for the Seniors Card sign in stores.
Additionally, if you’re receiving the Age Pension or another government allowance, you may also qualify for a Pensioner Concession Card. This card provides lower cost medicines under the Pharmaceutical Benefits Scheme, bulk billing for doctor’s appointments, cheaper out of hospital medical expenses through the Medicare safety net and assistance with hearing services. In addition, this card allows you to access many state based concessions.
An adviser can help
These are just a few of the many benefits available – but the eligibility requirements are different for each one.
That’s why it’s a good idea to talk to a financial adviser to make sure you’re getting all the retirement benefits you’re entitled to.