Planning for your retirement? Great news! The Age Pension can be like a friendly bonus to your superannuation and savings. Around 2.6 million Aussies already enjoy this extra income, and the number is growing. Let’s break down what you need to know.
Who gets the Age Pension?
The age at which you become eligible to receive the Age Pension has been gradually increasing from 65 to 67 with the age depending on when you were born. Plus, you must be an Australian resident for at least 10 years (with five of those years being continuous) and in the country when you apply. Some exceptions apply.
How much can you get?
The amount depends on your income, assets, and whether you’re single or part of a couple. The normal rates from 20 September 2023 are shown below:
These amounts are adjusted twice per year to keep up with the cost of living, so you won’t be left behind.
The income and assets test
The Age Pension is means tested, so Centrelink will consider any income and assets you might have when determining how much Age Pension you’re entitled to receive. There are two tests – the income test and the assets test.
- Income Test: For singles, your pension decreases by 50 cents for every dollar earned above $204. For couples, it’s the same, but the limit is $360.
- Assets Test: They look at everything you own, except your main residence. If your total assets go over a certain amount, your pension may be reduced. For example, if you’re single and a homeowner, the limit is $301,750.
Work Bonus
Thinking of working occasionally during your golden years? The Work Bonus lets you earn up to $300 per fortnight without affecting your pension. Anything below that can be saved up, reaching up to $11,800. However, the $11,800 limit is a temporary boost until December 31, 2023. After that, it goes back to $7,800.
If you start working while getting the Age Pension, you don’t need to apply for the Work Bonus, but you do have to let Services Australia know how much you’re earning. You can do this over the phone, online, or by visiting a Centrelink office.
Need support in planning for your retirement?
Wondering how the Age Pension will work for you, or are you overwhelmed when thinking about your retirement plan? The team at APS Financial Planning is here to help you create a strategy that will give your family confidence in the future.
Learn more about APS Financial Planning
Written by APS Senior Financial Advisor, Paul Hatzigeorgiadis.
Paul has over 25 years of experience in the financial services sector. Over Paul’s history, he has provided advice to an extensive range of clients from wealth accumulators to pre and post retirees advising them on Wealth Creation, Cash Flow Management, maximising Centrelink benefits in Retirement, Personal Insurances, Debt minimisation strategies and Superannuation. Paul is married with an 12-year-old daughter and enjoys spending time with family and friends. Whether it’s assisting clients to meet their short-term goals or working with them over a longer term, Paul enjoys helping guide his clients with their financial future.