13th Sep 2016
Age Pension: what are the asset threshold changes?
Senior couple look over documents trying to understand the changes to asset thresholds

Changes to the asset test thresholds and associated taper rate will affect an estimated 416,000 age pensioners – will you be one of them?

On 1 January 2017, the asset thresholds and taper rate that apply to the Age Pension asset test will change. This will result in the most significant alteration to retirement income this decade.

The asset free threshold is the value of assets that an individual or couple can own before their Age Pension payment is affected. For every $1000 worth of assets held above this threshold, the Age Pension payment is reduced by $1.50 until no payment is due.

From 1 January 2017, not only will the upper threshold reduce, meaning fewer people will qualify for a part Age Pension, the taper rate will also increase to $3 for every $1000 by which the asset free threshold is exceeded, meaning the Age Pension payment will reduce to $0 more quickly.


So, what are the current thresholds and what will they be from 1 January 2017 onwards?

 

Prior to 1 January 2017

From 1 January 2017

 

Asset free threshold

Pension cut-off threshold

Asset free threshold

Pension cut-off threshold

Homeowner

 

 

 

 

Single

$209,000

$793,750

$250,000

$542,500

Couple (combined)

$296,500

$1,175,000

$375,000

$816,000

Non-homeowner

 

 

 

 

Single

$360,500

$943,250

$450,000

$742,500

Couple (combined)

$448,000

$1,326,500

$575,000

$1,016,000


What if you lose your Age Pension due to the threshold and taper rate changes?
Those who are no longer eligible for the Age Pension will automatically receive a Commonwealth Seniors Health Care (CSHC) card to help with the costs of prescription medicines, utility bills, rates, etc. The recipients of these CSHC cards will be exempt, indefinitely, from the income thresholds usually applied.

How many people will be affected?
It has been claimed that 170,000 pensioners will be better off, with 50,000 currently receiving a part Age Pension expected to receive a full Age Pension once the thresholds have been changed. A further 120,000 on a part Age Pension can expect their payment to increase by $30 per fortnight. These changes will also see 91,000 lose their Age Pension entitlement and about 235,000 see their part Age Pensions reduce.

Can I get rid of assets before then?
Generally, yes you can, but if you’re already in receipt of an Age Pension, or planning to claim and Age Pension within the next five years, you should be aware of gifting rules and how they might affect your Age Pension assessment. You should also consult an independent financial advisor to ascertain the best way to structure your finances to maximise your income.

Updated 13 September 2016


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    COMMENTS

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    Pat
    25th Jul 2016
    9:54am
    We are affected by the taper change to the tune of about $10,000pa! You state that the Commonwealth Seniors Health card helps with the cost of utility bills, rates etc. My understanding is, at least in Victoria, that no help is given for these under this card. Can you please advise?
    micko
    26th Jul 2016
    2:31am
    Debbie.....can we get a response to this question regarding Victoria please?
    marg
    25th Jul 2016
    10:24am
    I understood also in NSW CSHC card only for medications and no help with utilities regos ect..please clarify
    Old Geezer
    25th Jul 2016
    10:55am
    In NSW you can get a rebate off your electricity bill with a health care card so check with your electricity retailer.
    Gra
    25th Jul 2016
    11:15am
    In NSW you also get a rebate on land rates, water rates, gas motor vehicle registration and government transport.
    FrankC
    25th Jul 2016
    4:08pm
    And I also believe that driving licences are free in NSW for pensioners
    Rae
    25th Jul 2016
    6:49pm
    My accountant put the monetary value of the discounts at approximately $4600.

    She was commenting on the fact that it would be great to get even $1 part pension to access those discounts.
    OlderandWiser
    28th Jul 2016
    9:02pm
    Get it right please. In NSW, rates, water rates, gas and motor vehicle registration concessions are NOT available to CSHC holders. They are ONLY available to pensioners. So those who will lose their pension will suffer much higher costs as well as a huge cut in income.
    Old Geezer
    29th Jul 2016
    3:11pm
    With those amounts of assets these ex pensioners have no need to worry as they have plenty of money to pay for them. The rest of us have to pay for them so why shouldn't they do the same?
    OlderandWiser
    30th Jul 2016
    4:49pm
    Why, Old Geezer? Because people who have LESS income than pensioners shouldn't pay MORE for essentials. Accrued savings are PERSONAL. They DO NOT BELONG TO THE NATION. They are acquired by personal sacrifice and the person making the sacrifice should be entitled to the benefit of it. It is unfair and selfish in the extreme to suggest that someone who went without lifestyle should be forced to hand the benefits of that sacrifice to someone who didn't.

    You would scream like a stuck pig if someone suggested you should hand half your assets to aged pensioners so they could have a higher income than you. But you support doing precisely that to others.
    Old Geezer
    14th Sep 2016
    2:42pm
    Rainey it is no different to those of us who already don't qualify for the OAP. Our wealth didn't just fall out of the sky one sunny day. We earned it and paid tax just like everyone else.

    I agree it does not belong to the nation but belongs to those who have so why can't they spend it to live like the rest of us fully self funded retirees do?

    I don't personally own very many assets so the government would not get much if it tried to take half but you would also be effected by such legislation. How would you it effect you?

    Quite frankly if people went without as you say then why are they still OAPs? Maybe they didn't sacrifice enough like us self funded retirees did.
    PlanB
    13th Dec 2016
    12:41pm
    Yes NSW get free drivers licence and free rego -- but we have to pay for the Green Slip almost $400 -- thats an insurance against damaging another person or property -- it does not cover yourself
    AlbertC
    25th Jul 2016
    10:47am
    a loverly liberals trying to ake what they should not allways the same every time they win goverment the first thing they do is hit the pensioners in the hip pocket bluging bastarde should pay taxes like we did when we were working. and they should not be intitled to claim retirement payments as they do not pay taxesso wKE UP NOW ALL YOU FOOLS THAT PUT LIBS BACK IN (BIG MISTAKE)!!!!????
    Old Geezer
    25th Jul 2016
    10:57am
    I agree with the new asset test. People with these amount of assets should never have got the pension in the first place. The pension is a welfare payment that should only be available to those who have no other means of support.
    Saalbach
    25th Jul 2016
    12:18pm
    Actually the Age Pension is NOT welfare - it is an entitlement introduced to allow people to live after retirement. In other countries, the pension is paid in full to everyone, regardless of their assets. A fairer way of handling the pension would be to pay it in full to everyone of pension age, but to tax whatever other income they get from wages, Super or investments. For people without much Super, this would mean they would get some additional benefits from their money - for those with lots of assets, they would still benefit from having saved while working, but would effectively pay back what they get as a pension in taxes. Overall, the Govt would be better off, because they would get more back in extra taxes than they would pay in pensions.
    jackie
    25th Jul 2016
    12:28pm
    Old Geezer I agree. The Age Pension was originally created to help people in poverty. That never had super or decent steady incomes, properties, and investments. Age pensions have never been a luxury or easy to live on. The Age Pension is there to help the poverty stricken elderly.
    Old Geezer
    25th Jul 2016
    12:41pm
    Unfortunately to be an entitlement the age pension must be available to all those over a certain age but it is not. It is therefore welfare like all the other social security payments.

    I agree with Jackie the age pension is there as a safety net so people don't live in poverty in their retirement years. It should only provide for the basics not the luxuries of life.
    Fliss
    25th Jul 2016
    12:51pm
    Saalbach, brilliant suggestion. They'll never do it - is far too logical a plan for politicians to agree!
    Also see Blinky Bill's comment below . . . . backs up what you are saying.
    Radish
    25th Jul 2016
    12:56pm
    If the pension was an entitlement everyone would get it regardless of income.
    Truck
    25th Jul 2016
    1:12pm
    The old age pension was not originally intended as welfare or worse charity (which always involves demeaning the recipient) but as a reward for service. To quote an earlier article on this topic https://www.yourlifechoices.com.au/a-fair-go-for-older-australians "In 1908 when the Age Pension became law, an Opposition Minister named Mr Reid stated, “I wish to heartily commend the character of this measure … in so far it removes the idea of old-age pensions from any suggestion of a charitable allowance. An old man, who has done his duty as a citizen for 25 years (is) as much entitled to a pension as a commander-in-chief or a chief justice”." There was a time when the OAP was paid for (at least in part) by tax contributions like the UK version but this was stopped. It might be best if it just went back to being paid for by a lifetime levy like Medicare.
    OlderandWiser
    30th Jul 2016
    5:00pm
    Jackie, if we hand out to people who don't save and take from people who do, what do you think will happen? The assets test is STUPID because it sends a strong message to people to spend up big and put their hand out for pensions - or give their money to their kids before retirement, or sink it into a huge expensive house.

    It boggles the mind that people are so shallow-thinking that they can't see past the rubbish claims that taking money from battlers will save the nation money. It won't. It will drive aged pension costs through the roof and erode the personal wealth that is currently sustaining Australia's economy while other countries are sinking.

    Try to think beyond the short-term nonsense that politicians and Old Geezer peddle. Use some common sense. Would you go without holidays and restaurant dinners to save if you knew that a few years later the government would say ''Oh, you saved. We'll give pensions to everyone who didn't, and screw you - you can spend your hard-won saving and get no benefit from it''?

    NOBODY is going to be better off by robbing Peter to pay Paul. What we need is a system that encourages saving, and rewards it fairly, and focuses on INCOME for means testing purposes, so those who struggled to save but have greater needs or lesser capacity to make their money work for them (due to disadvantage) are dealt with fairly and there is no incentive to waste money in order to avoid an unsustainable income.

    Think it through. Johnny eats his sweets and is given pocket money to buy more. Harry puts his sweets away for later and is told ''You've got sweets already. No pocket money for you this week.'' What do you think Harry will do next week? Eat the sweets of course, and put his hand out. And that's EXACTLY what people will do who are being hurt or threatened with future unfairness by cruel assets tests.

    The simplistic ''you've got some, I haven't - screw you'' attitude WILL destroy the nation. It will drive hundreds of thousands more onto the full aged pension, whereas retaining fair policy would have meant they were content with a small part pension and potentially might grow their wealth to need no pension at all down the track.

    Pea-brained politicians have made sure our pension costs rise and our nation suffers.
    Old Geezer
    14th Sep 2016
    2:59pm
    "if we hand out to people who don't save and take from people who do, what do you think will happen?" Nothing that is what is happening now to us fully self funded retirees. Then again maybe I should buy that 20 bedroom house with 12 bathrooms.

    So the new asset test will save the government money as less will be paid out on welfare. I can't see any negatives other than one's heirs will have to go economy instead of first class to Disneyland.

    It's too late for the current OAPs to do much really but a few of those with 5 years or more out from the OAP may stop work and spend down their wealth before applying for the OAP. However super will soon start to cut in and this too will not be an option.

    Nobody is robbing anyone Rainey. Super makes saving mandatory so encouraging saving is not near as important as it may have been in the past. Also what is Johnny doing eating sweets as they are not good for him? What is Harry doing with sweets too? That Rainey is why we have a fat epidemic today. Kids were given sweets that led to them eating way too much sugar. How many times did you give your kids vinegar and water to kill the yeast in their guts that had their brain craving sugar? Try it as it works.

    Our pension costs will rise only because we have too many people at an age where they could qualify for the pension. However as time goes by super will start to cut in and the pension costs will start to reduce.

    So our politicians do know a thing of two about what they are doing and how it will all work out.
    Blinky Bill
    25th Jul 2016
    11:32am
    I read, but don't post on here very often, however:
    As a wartime measure, the Federal Government gained control over Australian Income Tax. Labour party prime minister Ben Chiefley introduced three bills to establish the Nationa; Welfare Fund, to be financed by compulsary contribution (levy) of one and six pence in the pound on all personal income.
    Opposition leader Robert Menzies stated that the compulsary contribution be kept separate from other government income streams, that it should be shown separately on the taxation assessment and paid straight into a "trust" account, and not mixed with general revenue.
    Menzies said; the stigma of charity should be removed from the Age Pension and that it should be an entitlement earnt by the person's persona; contibution to the fund.
    History tells the true story. Can anyone prove that we have not contributed? No!
    Therefore, because you and I have contributed how can the age pension ever be called charity or welfare.
    HarrysOpinion
    25th Jul 2016
    12:16pm
    Because the government and its band of elite thieves have said so ! What did you expect from generation X ? Boomers brought them into this world, fed them,clothed them, gave them a roof over their heads helped them to be educated, gave them financial support and they crucify the boomers in gratitude.
    Retired Knowall
    25th Jul 2016
    5:28pm
    If it is a reward for a persons contribution, how do the drones that have never worked and lived in public Housing?
    Is it because they bred 2 or 3 more generations of oxygen thieves?
    HarrysOpinion
    26th Jul 2016
    12:39am
    Mixed feelings about that Retired Knowall. There is a huge social problem with more than oxygen thieves in Melbourne.
    Radish
    28th Jul 2016
    1:13pm
    Just because we paid taxes does not mean we are entitled to an aged pension. It is 'not' an entitlement any more.

    The country would go broke if every single person, rich or poor got the aged pension without an assets or income test. People would be screaming from the rooftops if the likes of James Packer, Malcolm Turnbull, Kevin Rudd all got the aged pension (in addition to their politicians perks) on retirement.

    I agree that the assets test was too generous and it had to be reined in.
    OlderandWiser
    28th Jul 2016
    9:07pm
    Sorry Pepe La Pew. You are dead WRONG. The aged pension is NOT unaffordable. The superannuation tax concessions - 80% of which benefit the wealthiest 20% of the population - cost MORE THAN THE AGED PENSION.

    The assets test was NOT too generous. It recognized low return rates and the need to encourage and reward work and saving. The change will drive the cost of pensions UP UP UP as people realize planning, working and saving is now totally futile unless you can achieve over $1.5 million in returning assets. Reining in superannuation tax concessions would have hurt nobody and saved at least 6 times as much, and would not have destroyed incentives for people to work, save and invest to try to be self-sufficient in old age.

    If we are talking about policy that is good for the nation, the assets test change was as BAD AS IT GETS. Only short-sighted gullible fools will endorse it.
    ex PS
    1st Aug 2016
    4:32pm
    Pepi, so we cut pensions because they are affordable, what next, health care, police services, education, the list is endless?
    ray from Bondi
    14th Sep 2016
    12:37pm
    yes, I have heard this also, all politicians are concerned with is keeping their trough full that and that only.
    hedi
    25th Jul 2016
    11:43am
    Does that apply to the Politicians as well ? or can they still get their Pension and being able to get another job without reducing their Pension ??
    HarrysOpinion
    25th Jul 2016
    12:18pm
    Government / Parliament Pension is for the privileged and different rules apply, not for commoners like us.
    Alexii
    28th Jul 2016
    2:10pm
    So true, HS.
    Radish
    29th Jul 2016
    10:15am
    My return last year on my super was 3%/
    Mad as Hell
    25th Jul 2016
    11:51am
    As a couple If we have $375,000 or $823,000 in assets we will generate roughly the same income. What is the incentive to save more than this amount?
    Fliss
    25th Jul 2016
    11:52am
    Yep! I don't see the incentive there at all . . . . . . .
    since a couple who own their home & have $370,000 in assets. will receive the full pension plus $$11,100 p.a (assuming return on assets of 3%).
    While a similar couple - owning their own home but with $825,000 in assets will receive no pension & will have $24750 p.a. to live on. Huh???
    HarrysOpinion
    25th Jul 2016
    1:36pm
    Mad as hell - to generate the same income as the full age pension for a couple ($33,701.20 p.a ) having only $375,000 in cash asset you'd need to find a source of investment that will generate 18% interest earning p.a. (Good Luck with that one !). On the other hand, $823,000 means that all you need to find is a source of investment that will pay you 5.15% pa to generate the equivalent of $33,701.20 pa ( this takes into account the income tax you will have to pay). The above is an assumption that the person will not depend on any age pension welfare.
    The person with $375,000 in cash assets at the safest level the investment will only generate 2.5% pa interest and that is $9,375 pa. Hardly enough for a couple to live on let alone pay rent etc. You will erode your capitol within 10 years if you draw the equivalent of the age pension for a couple and you will be subject to the age pension rules in the future. But, the couple with $823,000 can survive for 20 years and still have about $375,000 left in the bank.
    Old Geezer
    25th Jul 2016
    1:49pm
    The idea is to use your capital until you get back to a level where you once again qualify for the pension. You have to have over $823,000 before you lose all your pension so as you decrease your capital you get more pension until you get the maximum pension. I can't see a problem with that.
    Rae
    25th Jul 2016
    2:35pm
    I can't see the point of all that saving and going without for the Nation.

    No one else seems to give a damn about The Nation.

    It would be sensible to update the car, do any renovations or maintenance, gift the legal amounts and go on that fantastic holiday you always wanted.

    The average value of a single aged pension is $390 000 and $590 000 for a couple so denying yourself a lifestyle enjoyed by other workers just to save for yourself makes absolutely no sense unless you are one of the 4% of wealthy salary or business owners.

    In fact you are also denied the several thousands the health care card provides if you fund yourself.

    It simply doesn't make any sense anymore.

    For those needing to pass an income test their own after tax non concessional contributions are counted as income a second time
    when received back as part of the self funded pension.

    I don't think these advisors, economists and politicians have the foggies idea of what they are doing. There is no one with any sense to slow them down either.

    They have ruined superannuation. Once it was just tricky scammers and fees and charges but now the sovereign risk just isn't worth the effort.
    Old Geezer
    25th Jul 2016
    3:04pm
    Other than a tax effective vehicle super has no benefit what so ever to me. It should not be deemed as income for the health care card as you are providing your own pension only not the benefits.
    Mad as Hell
    25th Jul 2016
    4:53pm
    Old Geezer_My problem is this is retrospective legislation that will put me out of pocket $10,000 p.a. The Liberals and the Greens moved the goal posts for those who are not rolling in it. $823,000 will not generate a comfortable income for a couple according to ASFA Retirement Standard. I don't appologise for wanting a comfortable retirement.
    Retired Knowall
    25th Jul 2016
    5:30pm
    The incentive is to get off your bum, work harder and smarter so you don't need to rely on WELFARE.
    Old Geezer
    25th Jul 2016
    5:46pm
    That's the problem Mad as Hell the pension should not generate a comfortable retirement. It should only be for the basics so that people don't live in poverty.

    Was reading earlier about pension funds earning 10-12% over the last five years. If you earned 10% on $823,000 then that most people would be quite comfortable on that. If you park your money in lazy bank deposits then of course you are not going to earn much as the bank will earn the cream on your money. You need to do what they do with your money instead.

    If you think the pension is for a comfortable retirement then you should think again.
    Retired Knowall
    27th Jul 2016
    7:32am
    Over the last 10 years Super Funds earnings were more like 5 - 6%.
    Fliss
    27th Jul 2016
    7:59am
    Rae, can you please elaborate on what you mean when you say " For those needing to pass an income test their own after tax non concessional contributions are counted as income a second time when received back as part of the self funded pension.". Thanks.
    Mad as Hell
    27th Jul 2016
    9:03am
    Retired Knowall-my beef with the changes to the assets test is that the goal posts were moved after I retired. This is retrospective legislation that affects years of sacrifice. Where are the taxes I paid into the Old Age Pension (OAP) from 1968-1992 when the OAP was an entitlement ? By the way my funds are in balanced fund earning 6.5% on a 10 year average. $375000 plus pension gives gives the same income as $823000 with no pension. Why save more than $375000 for a home owning couple?
    Retired Knowall
    27th Jul 2016
    4:55pm
    Mad as hell, I understand your pain and I fear it's only going to get worse as the proportion of Worker to Welfare recipient gets worse.
    The younger generations are not educated into the financial tidal wave that's going to hit Aust. in the next 10 - 20 years. The current Super Guarantee loading of 9% is a joke. BTW it's amazing that the Govt. has to introduce a compulsory Super System, when the average worker should have worked out that the pension system will not be enough in retirement.
    Radish
    28th Jul 2016
    8:39am
    Compulsory super should be at least 15% now. The young generation only live for today (not all but a lot) what a suprise they are in for when they retire!!
    Alexii
    28th Jul 2016
    2:18pm
    Old Geezer, with your apparently great knowledge, I wonder if you would tell us where we can earn, safely, 10% on our super. If you can, I'll happily take my super funds and invest it in your recommendations and live a damned site better than I do now and not have to give a stuff about getting my reduced part pension next year.
    I'm really looking forward to your advice and imagine there are others who are also looking forward to it.
    Old Geezer
    29th Jul 2016
    3:13pm
    Unfortunately to tell you I would be in breech of the law as I'm not a financial advisor and I certainly do not know my client.

    Look up the returns for super and you will find them.
    Hairy
    25th Jul 2016
    12:13pm
    Blinky bill you are correct they changed the goal posts.and they will do the same with super and we will still be beggars the leaders of this world are raping a pillaging under the name of goverment it's bloody disgracefull I'm ashamed to be an Australian
    Old Geezer
    25th Jul 2016
    1:06pm
    That's why you are better off paying a bit of tax than having all your money in super. So if they take your super you still have enough assets to keep you out of the poor house.
    Pierre
    25th Jul 2016
    2:04pm
    Didn't Truss just retire on 300K a year. How come his super converts to a pension of 300K a year and nobody else's does? If we apply the 2.5% return equation to Truss's income he would need 12 million in his fund, and that would never reduce.
    Ah well - we did vote to have these clowns screw us.
    Aussiefrog
    26th Jul 2016
    3:53am
    Spot on Pierre, politicians pension is not justified in any ways and then they turn around and tell us to do the heavy lifting, what a bloody joke while they argue like school kids in parliament and play with our future!
    Alexii
    28th Jul 2016
    2:21pm
    Great one, Truss. Wouldn't it be just wonderful to get a super like that - it's no wonder they don;t understand the rest of us on our paltry amounts of super and therefore needing that part pension that even Howard seemed to recognise that we needed.
    ray from Bondi
    14th Sep 2016
    12:38pm
    here here
    gibbett
    25th Jul 2016
    2:33pm
    why is it if you own a home you assets above the home value is less than some one who does not own a home .
    Rodent
    25th Jul 2016
    2:39pm
    Debbie

    Why have you not mentioned that the Asset Thresholds are to be Frozen as from 1 July 2017 for 3 Years?

    Also for info only is the extract of a recent Email I sent to an Australian Journalist
    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>
    I noticed in particular the reference to grandfathering of changes, I agree with that principle. HOWEVER in the case of the legislated changes to the Pension due for implementation on 1 Jan 2017 no such consideration was given. In fact when asked about it the Govt just said it would be too difficult, yet now they have effectively done just that by leaving the Clean Energy Supplement with all existing Pensioners, and at the same time NOT providing this Supplement to NEW Pensioners, so much for being difficult. Guess what will happen next? - my view is that the Clean Energy Supplement will be removed from ALL existing pensioners in the life of this next Parliament.

    Question for Old Geezer re your comments
    I agree with the new asset test. People with these amount of assets should never have got the pension in the first place. The pension is a welfare payment that should only be available to those who have no other means of support.

    What a sweeping generalised statement you make . So at what value of Assets do you consider that a Pensioner should still receive an Age Pension - I will help you, perhaps its only when their assets are say ZERO , or $100k - or whatever- give us your views please as somebody who claims they have helped people get a pension, ie where you have assisted them in their understanding of the process?
    Old Geezer
    25th Jul 2016
    3:29pm
    Knowing what I do know about the pension and the loop holes it is just so unfair and inequitable to many people. Just because I assist people to get the what they can with the age pension and other welfare payments it does not follow that I agree with they system. It is simply crazy that 2 couples with same wealth but a different mix of assets can get vastly different pensions. One couple who didn't qualify for the pension due to too many assets so just by putting money into the wife's super as she wasn't yet pension age they now get the pension and all the benefits. They hope to now fill their bucket list and when she gets to retirement age still get the pension as they would have "enjoyed" their other capital. I also know quite a few people who have too many assets to qualify for the pension so they leave work before pension age and spend their capital down crossing things off their bucket list and renovating their house etc.

    To me the age pension is welfare and should only be given to those who need it not to those who are entitled to it and not because they need it.
    Scrivener
    25th Jul 2016
    4:12pm
    'The pension is a welfare payment that should only be available to those who have no other means of support' - hell I can't afford the elastic to keep my socks and under-dungers up. No visible support at all.
    OlderandWiser
    28th Jul 2016
    9:23pm
    So how come in EVERY OTHER DEVELOPED COUNTRY it's a right and paid to all retirees? Why is Australia the ONLY developed nation that punishes work? Do we WANT to create a nation of bludgers?
    OlderandWiser
    28th Jul 2016
    9:26pm
    Anyone with half a brain could figure easily that it is detrimental to the nation and unfair to people to fix the assets threshold in any other way than linked to returns. When interest rates are low, the assets level MUST GO UP - NOT DOWN. Otherwise the message sent to people is ''Saving is foolish. Blow your money, give it away, invest in an expensive home, or hide it, and claim the pension''. And that's precisely what folk will do under this IDIOTICALLY DESTRUCTIVE new regime.
    Fliss
    29th Jul 2016
    12:29am
    Absolutely Rainey! - asset thresholds should be linked to returns. Just as the deeming rate should be.
    Retired Knowall
    30th Jul 2016
    10:53am
    No RAINEY, we want to create a nation of workers that work smarter and harder to support themselves not create/support a welfare mentality.
    Retired Knowall
    30th Jul 2016
    10:54am
    WRONG AGAIN RAINEY, do some research before you post your dribble.
    Britain's state pensions are among the worst in the developed world only topped by Mexico, according the Organisation for Economic Co-operation and Development.
    OlderandWiser
    30th Jul 2016
    5:12pm
    Retired Knowall, you are insanely illogical. Create a nation of workers who work harder and smarter to support themselves? By telling them ''If you get to $1.5 million - with the help of massive government tax concessions - lucky you, you can keep it. But if you work your guts out and be as smart and diligent and frugal as you can and only get to $820,000 in retirement, we'll take it all off you and you'll be worse off than someone who saved half as much.''

    Yeah, that's really going to build a nation of workers. NOT!

    What a thoroughly IDIOTIC NOTION, that rewarding either being RICH or NOT SAVING and punishing battlers who save is going to make people work harder. Goodness, it boggles the mind that anyone could peddle such utter rubbish.
    Rodent
    25th Jul 2016
    3:09pm
    Debbie


    Part 2 - are your Current Pension Cut Off Threshold Figures in this table correct, as at 1 July 2016?
    Rodent
    27th Jul 2016
    8:24am
    Rodent

    Debbie Please Note if reading? , the table figures are correct, It was my misreading of the table

    Apologies
    Rodent
    25th Jul 2016
    3:46pm
    Dear Old Geezer

    I understand where you are coming from and your perspectives, even when we don't agree, and I am sure that there are some that may work the system to their advantage, especially if they had been "advised" by a so called Financial Adviser - All Advisors, and others in the Industry tell clients its in their interest to arrange their affairs to maximise the pension entitlements (apologies re the use of that E word ) but that is the word the Industry and others use to describe the Age Pension. I could go on about that , but I wont now.

    Would you care to comment on my question about what Asset Value should apply to still receive the Age Pension?
    Old Geezer
    25th Jul 2016
    4:26pm
    Let me put it to you this way. A couple with $1.2 million in assets are not investing their assets well if they can't get an income considerably more than the old age pension per year. Even with the threshold dropped to $823,000 it is not that difficult to get an income equal to the pension.

    So why do these people need the pension for the basics of life as they already have that amount of income? If they need money for luxuries then the taxpayer should not be providing for this.

    So you have to look at what the age pension is for. If it is too stop aged people living in proverty then these people above clearly do not qualify.

    The other thing is that people saved for their retirement in super or otherwise so why do they not want to use the money for this purpose? Personally I think people are their own worst enemy if they are not using their capital because statisticians only have to check Centrelink figures and it doesn't take much to come to the conclusion that if people are not reducing their capital why are we continuing to pay them the pension? Who is really benefiting from these assets? No other than those who inherit them.

    The government is looking to save where ever it can so when they get statistics that show they are spending on something not needed then it is a saving to them to cut it.

    I'd rather not say too much about financial advisors other than theory and practice can be poles apart.
    OlderandWiser
    28th Jul 2016
    9:16pm
    Firstly, Old Geezer, the government is NOT SAVING by punishing saving and discouraging people from striving to fund their own retirement. There is simply no point now in sacrificing lifestyle to save for old age, so pension costs will SKYROCKET. (But only the intelligent can see that, so I apologize for confusing your poor little inadequate brain!)

    Secondly, may people who will suffer a massive income cut DON'T have the capacity to invest for more than a very low return - because of educational deprivation, ill-health, lack of access to good advice, past crisis or trauma making them risk-averse, etc. So the change rewards the privileged who can gain high returns and hurts the less privileged who can't - the EXACT OPPOSITE of what the government claims to want to achieve

    Thirdly, people saved for their retirement so THEY could enjoy a better lifestyle - NOT so the stinking government could take their money and give it to people who DIDN'T save for retirement. I have no issue helping the needy, but most who gain from this change are NOT needy. They simply lived it up earlier in life when I, and others, were making huge sacrifices. And now THEY are reaping the rewards while people who struggled to save suffer.

    The policy is NOT good for the nation. It is NOT fair. It is NOT a policy that anyone with a brain would endorse. It's stupid, short-sighted and hideously destructive.
    Mad as Hell
    29th Jul 2016
    7:30am
    Hi Rainey- Well put agree with you totally.
    Alexii
    29th Jul 2016
    3:59pm
    Like Mad as Hell, I also agree with your excellent statement, Rainey.
    ex PS
    29th Jul 2016
    4:58pm
    Rainey, well said.
    Old Geezer
    14th Sep 2016
    3:04pm
    Rainey the only unfair part of this policy is that people will have to get off their posteriors and put in a bit more effort to get better returns on their money. When interest rates will high it was easy but times have changed.
    mike
    25th Jul 2016
    4:07pm
    To Old geezer, this is an attack on the hard working middle class. The wealthy havn't been touched, but I am 70 years old, and worked my guts out for the last 50 years, raised 4 children and worked and saved for my retirement under Centrelink guidelines, and possibly ruined my health in the bargain. Those that drank and played the pokies and partied are the ones being rewarded. I am just sorry that I supported the blasted money thieving filling their own back pockets Liberal for the last 50 years.
    Old Geezer
    25th Jul 2016
    8:16pm
    The wealthy have been paying for their own retirement so why should they be touched. Welfare is for the basics of life not for a comfortable retirement for the middle class.
    Old Geezer
    25th Jul 2016
    8:43pm
    Neither. I'm a self funded retiree who helps pay the welfare bill.
    OlderandWiser
    30th Jul 2016
    5:05pm
    Crap, Old Geezer. The TAXPAYER paid for the wealthy's retirement with massive superannuation tax concessions, capital gains tax concessions, negative gearing, and a heap of other benefits.
    You are NOT SELF-FUNDED. You are TAXPAYER FUNDED through concessions poorer folk don't get - concessions that cost the nation far more than the aged pension, and benefit only the richest 20%.

    Mike is absolutely right. It's an attack on the working middle class. The wealthy haven't been touched. Those affected are being ROBBED while those who wasted their money or gave it away are rewarded. It STINKS and it will do huge damage to the economy. It will push the total cost of pensions very much higher.
    Old Geezer
    14th Sep 2016
    3:13pm
    Rainey you assume that the wealthy invest to save tax by using all those shelters. Wrong. The wealthy invest to make money and only then may use some of these shelters if it is practical to do so.

    I am fully self funded and have paid all my taxes. I have done nothing that any other taxpayer could not have done. I could have also done a lot more to save tax but it would have come at a cost and it is doubtful if it wold have been financially worthwhile. Just because a tax shelter exist does not automatically make it a good thing to use financially.

    One of the best tax shelters available is today used by a large number of OAPs. They own their own house!
    Scrivener
    25th Jul 2016
    4:08pm
    The evil Darth Morrison will kill me sooner than later, but the toxic Karma from that act will stay with him longer than the smirk on his face.
    Aussiefrog
    25th Jul 2016
    7:44pm
    Is your super an asset!
    Fliss
    26th Jul 2016
    4:54pm
    Are you asking seriously?
    In case you are . . . . yes, super is most definitely an asset.
    Retired Knowall
    27th Jul 2016
    7:36am
    And we allow you to vote?
    Fliss
    27th Jul 2016
    7:55am
    Certainly is!
    old fart
    25th Jul 2016
    7:45pm
    Money is put away in Super to spend on your retirement not to just have it there to earn an income from Investment proceeds
    So why don't you spend it & when it gets down to the Threshold, claim the FULL Pension, its not rocket science or stop whinging about not getting the Pension
    Old Geezer
    25th Jul 2016
    8:18pm
    I agree now is the time to spend your super for your retirement as the days of saving are now over. So spend it and enjoy yourself and stop whinging. Once you spend enough to get under the threshold the welfare safety net kicks in.
    ex PS
    26th Jul 2016
    12:20pm
    old fart, if that was all there was to consider I would agree in fact to some degree my own retirement plans were founded on this provision.
    But now we have the crackpot suggestion that pensions should be provided by using the family home as collateral, this puts a whole new complexion on matters. Especially since some people have already factored in the possibility of using the family home to pay for Aged Care.
    It seems that yet again the financial geniuses in government plan to spend the same money twice.
    Rae
    26th Jul 2016
    2:11pm
    I don't think this idea will get over the line. There are too many self employed who have put too much into the home and receive the aged pension for it to be included in the asset test.

    I'd be happy with that personally as I don't get a cent of government welfare.

    However I believe they will introduce a land tax and increase the GST as that will be seen as "FAIR".

    They will do exactly whatever the IMF instructed Morrison to do I suspect.
    Rodent
    26th Jul 2016
    12:34pm
    Dear Old Geezer

    I note that you are finding it difficult to answer my specific question about Asset Value to still receive a pension. You are behaving a lot like a Politician by just skirting around the issue. I must therefore assume that value from where you sit is ZERO?

    Here are some comments from ACOSS to me in answer to an Email I sent recently about the Pension changes due in Jan 2017 - I am sure you will be understood agree with these thoughts, or will you?
    ................................................................................................................
    ACOSS comments
    Home ownership is often considered the ‘fourth pillar’ of the retirement income system in Australia, behind the pension, super and other assets. As you’d be aware, renting in retirement is expensive, hence the larger asset allowance for non-homeowners. (Fyi, around 75% of Age Pensioners own their home).

    The difference in the treatment of a single homeowner and couple non-homeowners reflects this component of our Age Pension system. A discussion of fairness of these changes would also need to consider whether the different treatment between homeowners and non-homeowners is fair overall. I personally think that allowing larger assets for non-homeowners is justified, given the additional costs they face for housing.

    I should also add that the changes to the taper rate bring the rates back to what they were before the Howard Government relaxed them in 2007. When that happened, it brought a lot more people into the pension system, who didn’t necessarily ‘need’ a part pension. These changes reverse that reform.
    Old Geezer
    26th Jul 2016
    7:46pm
    Yes I knew about what happened in 2007 and I personally know the main lobbyists that were behind this change. I was disgusted with their greed at the time and I have seen them since the latest changes were announced and they are not happy at all. Nearly 20 years of hard work down the drain is their current mantra.

    The government wants people to spend their retirement money and if they don't it sends the wrong message in that they really don't need the pension. If pensioners buy more expensive homes to tie up their wealth then they will just bring forward the assessing of the home as part of the assets test. Whole pension system is badly designed and is forcing people to do the opposite of the practical thing to do. They should be downsizing not upsizing their homes and old granny should not be living in 2 rooms of a six bedroom mansion.
    OlderandWiser
    28th Jul 2016
    9:21pm
    ACOSS can't do sums (and neither, obviously, can Old Geezer).

    After 3 decades of struggle to pay off a home, many who will suffer pension loss in 2017 are faced with a cost of $450 a week for the privilege of living in their own home. This is made up of rates, maintenance costs, insurance, and the enormous pension loss punishing home owners for going without all those lifestyle comforts to pay their mortgage.

    The balance is clearly well in favour of the renter.

    As for ''the government wants people to spend their retirement money'', Old Geezer - what BS! The government has NO MORAL RIGHT to determine what people who went without luxuries to save should do with the resulting money. If they want to leave it to their offspring, that is their moral right. Why should the guy who spent his money on a world trip get a pension while the guy who put his money away for his grandkids' education can't? That's as unfair as it gets, and a gross disincentive to work, planning, saving and investing. Bad for people. Bad for the nation.
    Mad as Hell
    29th Jul 2016
    7:37am
    Hi Rainey- You nailed it again couldn't agree more or said it better.
    Old Geezer
    29th Jul 2016
    3:09pm
    It is obvious that if people are not spending their savings in retirement then they are getting too much money in welfare. It doesn't take rocket science to work that out.
    Alexii
    29th Jul 2016
    4:06pm
    Here I am again, agreeing absolutely with what Mad as Hell just said, "Hi Rainey- You nailed it again couldn't agree more or said it better."
    ex PS
    29th Jul 2016
    5:05pm
    Old Geezer, you remind me of an old boss I had when I was in my twenties. He heard that I had bought my Mother a colour TV for her birthday and in all seriousness told me that he must be paying me too much.
    Your comment about people not having to spend their savings in retirement reminds me of him, it is a statement right out of medieval England and it probably belongs there not in modern society.
    OlderandWiser
    30th Jul 2016
    4:45pm
    I note Old Geezer won't answer my question. Because he can't. Because he KNOWS HE IS WRONG. Any system that allows someone to spend or gift their money and put their hand out but denies fair treatment of responsible savers is a BAD AND DESTRUCTIVE SYSTEM.

    Old Geezer supports sending the nation broke with idiotic policy. And it WILL send our nation broke.
    ex PS
    1st Aug 2016
    4:23pm
    Rainey, it's par for the course OldBon, does not usually have an argument to back up his/her political propaganda. If it can't be covered in a three word slogan it will not get an explanation.
    Rodent
    26th Jul 2016
    4:34pm
    FIRSTLY MY APOLOGIES TO ALL ABOT THIS POSTING -SOME WILL FIND IT VERY INTERESTING, AND EVEN TOTALLY AGREE WITH MOST IF NOT ALL OF IT-

    As you can see I didn't create this
    ................................................................................................................
    What Changes to the Age Pension Assets Test Mean For the Property Market
    The Daily Reckoning May 25, 2015

    The government’s proposed change to the age pension assets test may have unintended consequences. The plan to lower the asset threshold for age pension eligibility has the potential to unleash a wave of retirees investing in new homes. And it could lead to a selloff in income producing assets, like stocks, to fund new home investments. In order to explain why, we need to look at the assets test itself.
    If you’re like me, you might find the assets test for age pension inherently flawed. That’s because it has its priorities wrong. It assesses pension eligibility based on the total value of assets you own — not how much income you receive from those assets.
    Now, it’s important to remember that the family home isn’t included in any asset test. Everything else however is assessable. That includes investment properties, stocks, cash or bonds.
    You can see what’s wrong with this straight away. The assets test should be looking at how much income you receive from your assets. If the issue here is how much pensioners need to live off in retirement, why isn’t income the main priority? Doesn’t it make more sense to assess eligibility based on what income you receive, and not the assets themselves? I think it does.
    That’s why the proposed change has its priorities mixed. What it may just end up doing is sending retirees rushing back into the property market because the family home is exempt from the assets test.
    In other words people are likelier to sell assets like stocks, and reinvest their money into a new home. That would achieve the aim of lowering total assets.
    This could result in a glut of pensioners moving up from their existing homes in a bid to keep hold of their pension entitlements. That’s exactly what the property market (read bubble) doesn’t need now — retirees buying up $1 million homes. In fact, the Department of Social Services estimates this could unleash 100,000 new buyers in on the market.
    So why does the government want to change the asset test threshold for age pensions? It’s simple really. And it all relates to superannuation.
    Why the government wants pensioners with larger super funds to spend their money
    If you’re a retiree with any kind of superannuation savings, the government has a word of advice for you. Spend more, and save less. And one other thing: don’t worry about your children’s inheritance — they’ll be fine.
    The government is arguing that people with substantial super should be spending more of it. They think far too many retirees are taking out pensions, and leaving their super as an inheritance. The AFR reported that the Treasury had findings showing that most retirees had roughly 50% of their superannuation left over when they died. That’s too much, the government says. In order to save money by cutting down on pensions, they want wealthier Australians to use more of the superannuation.
    To give you a quick example of how this might affect you, let’s assume you had assets of at least $750,000. Remember this includes any asset — like stocks — other than your home. Under the new proposal, you would receive $43,467 based on a 3% return on your superannuation. But you would get no pension.

    Yet someone with assets of $325,000 would be eligible for $33,717 in pension entitlements. Their superannuation would draw down $9750 for a total return of $43,467 in income. Altogether they would earn twice the amount of income as the person with assets over $750,000. You on the other hand would need to draw down more money from your super, without receiving a pension.
    The government think you should be spending that money, not leaving it to secure your children’s future. That’s why they want to take your pension away. But if they really want pensioners to spend more of their super, they’re going about it the wrong way. All it may result in is a horde of new retirees pushing up property prices even further to protect their age pension.
    That wouldn’t be the tonic for cutting expenditure on pension entitlements. And it wouldn’t help Australia’s out of control property market.
    Mat Spasic,
    Contributor, The Daily Reckoning
    Old Geezer
    26th Jul 2016
    7:36pm
    Three is one big problem with that scenario. The cost of stamp duty on housing. Nearly $41,000 in NSW on a million dollar house.
    Fliss
    27th Jul 2016
    1:46pm
    Rodent . . . thanks for posting - very interesting.
    Can I ask a couple of questions? . . . . in the example at the end, is this using a couple?
    How is the figure of $43,467 derived from assets of $750,000 since 3% is just $22,500.
    Shouldn't it read "Under the new proposal, you would receive $22,500 based on a 3% return on your superannuation. But you would get no pension."
    OlderandWiser
    28th Jul 2016
    9:01pm
    A pity there aren't more people astute enough to see the idiocy of the government's ridiculously destructive policy, Rodent. It's good to see Mat Spasic is switched on, but sadly I think the majority are just too dense and self-serving to take notice.
    Rodent
    27th Jul 2016
    3:35pm
    Dear Fliss

    Please note the source of the article, as I did not write this article, I just reproduced it. I will think about your question though, and get back to you
    Fliss
    27th Jul 2016
    4:16pm
    Thanks Rodent. I did note that, but still interested in discussing with someone - & who better than you? Lol! Since you posted. Interested in what you think.
    Rodent
    27th Jul 2016
    4:32pm
    Dear Fliss

    You are right, parts of what he has written are either unclear, or make no sense. I have Just Emailed him for an explanation. I have an idea what I think he meant , but will advise more later IF Mr Spasic replies, if he does not I will try to explain it more myself . My confusion is over the use of the term drawdown, and his resultant numbers etc
    As al would know Pensioners are required to Drawdon a minimium from their (Super/Assets)of between 5% and 9% pa -depending on age

    However Income EARNED from various investments could range from very little, say 2% to 3%pa for a TD etc to a much greater amount like about 5% to 12% (or more)

    So in summary more later

    My apologies if this article has confused you, or anybody else
    Fliss
    27th Jul 2016
    5:12pm
    Thanks Rodent! No apology needed!
    I was just a little confused - and actually I had thought the same as you re "draw down", but I still couldn't get the numbers to work with what he was saying. :)
    'Chelle03
    28th Jul 2016
    12:32pm
    Can anyone tell me if the family home is included in the 'asset' equation. It hasn't been but there was talk of changing that? Did that happen or not? Thanks
    Pat
    28th Jul 2016
    12:35pm
    No it is not included.....
    ex PS
    29th Jul 2016
    5:09pm
    Part of me is hoping that the LNP tries it. This would be the beginning of the end for them.
    OlderandWiser
    28th Jul 2016
    8:58pm
    The CSHC is virtually worthless compared to the Pensioner Benefits card. It DOES NOT qualify anyone for rates, car registration or license concessions and many other valuable benefits. The government is OUT OF TOUCH and seriously misguided and many politicians are now admitting the assets test change was ill-conceived and foolish. It punishes saving harshly and will drive the cost of pensions UP as more an more people recognize that saving for retirement is futile.
    Pat
    29th Jul 2016
    10:50am
    I approached the Victorian Government about extending the Pension concession benefits to the CSHC or Seniors Card but was advised that they could not as the funds for the benefits are supplied by the Federal Government. The Fed Gov only supply funds for the PBC....
    Old Geezer
    29th Jul 2016
    3:07pm
    Anyone that has assets outside those levels should be paying full price for things like the rest of us.
    OlderandWiser
    30th Jul 2016
    4:34pm
    Pat, I may be wrong but it was my understanding that the Fed. Gov. stopped funding these benefits in a recent budget and it's now up to States to fund them or cancel them. Some states have suggested they may not be able to continue offering these benefits to pensioners.
    OlderandWiser
    30th Jul 2016
    4:41pm
    Old Geezer, your illogical and hypocritical comments are mind-boggling. On the one hand, you support indulging the rich with ridiculous superannuation tax concessions that the nation can't afford, and on the other hand you support screwing battlers who saved. You CLAIM to support ''pensions for the needy'' but pay no attention to the definition of need. By your logic, someone who gifts hundreds of thousands before turning 60 is needy. Someone who spends bucket loads traveling the world is needy. Someone who buys a $3 million house might be needy. But a cripple with massive medical costs and needy extensive home help and disability aids is NOT needy despite an income of HALF the aged pension, if they happen to have struggled to save half a million and then received a $350,000 compensation payout which is SUPPOSED to enable them and their wife to meet the costs the disability imposes, but which in fact only saves other greedy and manipulative taxpayers.

    You really are full of it! You make no sense at all.

    I support the concept of focusing aid on the needy, but the nation's economy will collapse further if we destroy incentives, cancel out rewards for being responsible, and reward manipulation, dishonesty and extravagance. We cannot help the needy unless we assess need sensibly - and assets have NOTHING AT ALL TO DO WITH NEED OR CAPACITY. It's about health, education and many other factors that determine a person's cost of living and their ability to earn. And step one in focusing aid on the needy is to STOP THE TAX CONCESSIONS TO THE GREEDY. End tax concessions on super for high income earners, and stop corporate tax evasion. If we did that, there would be ample to pay generous pensions to everyone who DESERVES them.
    PIXAPD
    1st Aug 2016
    2:05pm
    NO one needs so much assets, it's ridiculous the amount of money folks can have and still get the pension, needs to cut back way, way more, or they don't get any pension at all. A person on the full pension and with full rent assistance can save $800 a month from their payment, that over $8000 a year
    Pat
    1st Aug 2016
    2:56pm
    Has anyone looked at the "Low income health care card". It is "deemed" income based and not assets based and gives the same benefits as the PCC. From my calculations those who are loosing their PCC because of the taper change may well be eligible for it...
    ex PS
    1st Aug 2016
    4:17pm
    Pat, until the government started trying to steal off the retiree populace I was quite happy to live off what I had in Super. But now I see that they are intent on robbing us to pay tax concessions to their campaign contributors I have started to investigate concessions that may be available to me.
    It seems that by rearranging my finances slightly I am able to access a low income subsidy, and this will lead the way to a seniors card.
    All things that I would not have considered until this government started to try and put its hands into my pockets.
    If you can't beat them, join them, what I am doing is not right but it is not illegal, straight out of the politicians handbook.
    Not Senile Yet!
    2nd Aug 2016
    1:09am
    Does anyone here know that the Assets Test was first conceived as measure to save spending on the Aged Pension?
    Yes...it was a way to cut costs associated with Pension Payments....when there was No Asset Tests whatsoever!
    In short..just like Britain.....your Aged Pension wasan Entitlement earn the by paying taxes for at least 25yrs....minimum!
    The only reason an Asset Test exists today....is because consecutive Governments could NOT BALANCE..their Budgets.....so costs savings had to be found.......and Welfare is the easiest target!
    Just label them all Bludgers and Tax cheats or Fraudsters......then no one objects!
    The Asset Test is a Creation of Governments to reel back what they have over spent in other budgets.....Nothing more...Nothing less!
    In short it is a Propaganda exercise to Screw Taxpayers out of what they are entitled!
    Poppa
    8th Aug 2016
    11:03am
    If say you have in Super $815000 plus $45000 in cash in a bank. Does this still qualify for a part or whole pension after 1/1/17 or do you go out...Poppa
    Pat
    12th Aug 2016
    10:55pm
    You go out. All assets are included except for the family home. Note that the house contents are included as is your car(s)...So if your assets not including your home are over the $823000 you get nothing....
    taylah
    12th Aug 2016
    9:14am
    Funny how M Turnbull demanded banks pass on reduced interest rates immediately but no mention of reducing deemed interest rates IMMEDIATELY no way can people pay current deeming rates its just another tax grab on we independent retirees I tell my kids spend now its useless saving for old age no one appreciates you for doing it
    Tassie
    12th Sep 2016
    12:28pm
    I might be reading this wrong,.,,we get a super pension and a part aged pension, we find this very good to live on. As we own our own home..BUT it looks like we might be one of the ones who loose some pension...just because we own our home???? maybe someone on here can clarify it for me better...???
    Fliss
    12th Sep 2016
    12:40pm
    Thresholds are changing for both home owners & non-homeowners. If your assets are above the new thresholds then you will lose some of the aged pension.
    Cuddlycas
    12th Sep 2016
    2:19pm
    I am 66 and divorced. For the past 10 years I did without to pay off my home and put enough into super so that I could retire. Recently both my parents passed away and I received $300,000 from the estate. This means I will now lose my part pension but this does not concern me as I hopefully will be able to support myself. My concern is the loss of concessions particularly medication as I have to get 4 scripts filled each month. With the cost of utility bills rising and the volatility of the share money I am concerned at how long I can afford to live if concessions are taken away. I have tried hard to do the right thing but now feel a bit pissed off. Are others caught in the same situation.
    Rae
    14th Sep 2016
    2:46pm
    Yes Because of saving and investing I earn more that the income allowed to get a government pension.

    I was a single mum with three little kids when my husband died suddenly. I worked a couple of jobs but did not earn above the average weekly rate. I saved 15% of all money earned. 5% for family spending ie school excursions, dental, and 10% for my old age. Learned to live well but frugally.

    Therefore I pay the same amount as a working person, who earns twice as much, for everything.

    That includes the $2 for a paper Telstra bill that a pensioner doesn't pay.

    I have managed to get costs down considerably though by shopping around. Depending where you live of course.
    Some of the discount chemists for example only charge $7.90 for a script I fill where others have charged as much as $23.80.

    I am very selective these days and walk away if the price is too high.

    I've changed electricity retailers( glorified bill collection agents), insurance companies etc.

    Not much can be done about government charges except to keep lobbying members about the inequality and unfairness of savers being continually ripped off.

    I do believe this government is foolish enough to keep on with austerity measures until they have us in a rip roaring recession so I advice all to save as much as possible and cut all excess spends until we see how the removal of billions from our real economy works out.

    The share market volatility is frightening but the bond market bubble is terrifying. If that market tips over every dollar saved will be most welcome.
    jock
    14th Sep 2016
    10:06am
    I note the threshhold for the aged pension is $1,175000 and I think our current assets surpass that figure by around $200,000. We have never received an aged pension but wonder if we are eligible to receive a Commonwealth Seniors Health Care (CSHC) card?

    Jock
    Rae
    14th Sep 2016
    2:52pm
    Yes I thought that too Jock. If all who can't get the pension get a card then that should include all above the threshold surely. The only problem might be having to tell Centrelink everything and having to deal with them at all.

    I thought it was just those who had received a part pension and then lost it but that would be incredibly unfair and the LNP are all for fairness aren't they. That is the catch cry... fair, fair, fair... although they could be talking about blondes.
    Oz
    14th Sep 2016
    10:40am
    You are peddling the same nonsense as the government about the effects of the asset test. In particular that the asset threshold for a single person has been raised to 250000$. If a person has 250000$ in assets the pension will reduce by about 56 dollars per fortnight. Becaus centrelink asses the pension entitlements under the income test.
    Woody
    14th Sep 2016
    11:32am
    How about giving us an example of the effect this will have on pensions.
    Give us a couple of examples.
    This way it will be a lot easier for pensioners to see if and how they will be affected.
    John
    14th Sep 2016
    11:34am
    Does that go for the government pensions as well I don't think so they're probably get 150 to 250,000 are you eating when you come out of parliament it's a rip off the line in the role pockets of ripping the pensioners off lords of busted
    robmur
    14th Sep 2016
    11:44am
    Pension cut-off threshold. For a couple combined, the original figure was $823,000. The above shows $816,00. Which is correct? When did the amount change, if so, why?
    Rodent
    14th Sep 2016
    4:33pm
    Dear robmur

    the $816,000 figure is close enough, its actually $815,800

    The $823,000 figure was an Estimate the Govt gave as the cut off point when it passed the legislation in May 2015, since that time Pension increases Sept 2015, March 2016 and Sept 2016 have effected the actual figure. I am sure Centrelink will get it right, eventually
    Herbie49
    14th Sep 2016
    12:00pm
    God morning Australia, after reading almost all the comments below I am still a little confused. My super returned a negative 0.38% for 2015 / 2016 but of course Centrelink still deemed me at 3.25% ho hum it's how it is after speaking to three financial,advisers, who all want me to hand over my money for them to invest wisely, and all for a fee of approx7k I am still wondering what to do. What I want to know is how do Centrelink know what your assets are now and in the future. If I get a few things fixed up around the house etc and my assets diminish by say 20k how will they know that. Old geezer has it all sewn up and doesn't want or need a pension, good for you. But surely it all comes down to what you have to tell the ATO in relation to your earnings of your assets, then get deemed by Centrelink ? I am happy I paid extra mortgage payments and worked whatever hours I could to save a bit, but as always it is a bit like Mortons Fork, if it looks like you are well of then the government wants it, if you are frugal, then the government things you have it hidden, and yes they want it.
    Cuddlycas
    14th Sep 2016
    1:12pm
    Hi Herbie,
    I also use a financial planner who costs me a fortune however is doing a good job considering the global economy and instability at this time. I believe your financial planner/adviser is required to prepare a statement in January that needs to be forwarded to Centrelink. Centrelink do an audit every year to find out how much you have in assets. This is how a lot of people will be caught out. Not sure, but I believe Centrelink, Taxation office, Banks and Medicare are able to access records so it is becoming very difficult. Some people have been rorting the system for years while the majority of hard working Australians are sliding down the tube!
    If you get repairs done around the house you will be required to keep all receipts etc. I need to get my house painted and believe it will be easier to organise this year. I remember my elderly parents when they were alive, had the carpet replaced in their house. Centrelink deemed that their shares were worth more than they actually were worth and reduced their pension. They were living on $18,000 per annum. My mother was in a wheelchair and I can remember the battle that my parents had to reinstate the lost pension.
    If you are unsure what to do then consult your financial planner who may be able to offer some suggestions. That's what you are paying him for.
    Old Geezer
    14th Sep 2016
    4:21pm
    I don't have to tell Centrelink anything. I only have to tell the ATO how much income and what expenses I had so that they can calculate my tax.
    johninmelb
    14th Sep 2016
    8:50pm
    Centrelink knows about your assets because you have to tell them when you apply for the Pension, or other payments, so they can calculate your eligibility, and how much to pay you.

    They know about my assets because I tell them. About every 6 months or so, I print out all my bank statements, super statement etc, and go down to see them to get my file updated. Since I am using some of those savings in addition to my part pension and small super pension, to live on, they are decreasing. That means I get a small increase in my pension, every time I go to see them.

    So many of you here have real or imaginary dramas with Centrelink, and I have never had a single problem since I went on the pension. I never get letters from them, they never query things with me, everything rolls along without a problem. That is not to say it will always be that way. Things can, and do go wrong.

    I AM NOT DEFENDING CENTRELINK. Like everyone here, I hate them with a passion, but you have to work with the system the way it is, and lump it, OR get off your fat backsides and change it.
    tactful
    14th Sep 2016
    12:11pm
    Look at all the whingers!!!!!!!1
    Assets, not including your home OK but your contents, most people put the insured or replacement value, how dumb are you!! The value of your contents, boat, car, caravan are what they will bring at a public auction. So your car is 2011, boat 2001, caravan 2003, red book for the car house contents and the other all together might come to $25,000.00 if you are lucky.
    Other assets are the value. Why on earth would any sane person want to live on the Age Pension if they have heaps of money tied up in investments, leaving something for your kids, don't be stupid. They will have your house, contents and other assets which they will sell and split the profits with their siblings. Why live a frugal life and be unhappy doing it, live a good life for yourselves and bugger the kids. If they can't get their acts together to darn bad.
    Your first and foremost responsibility is to yourself and then your partner, it is your responsibility to look after yourselves now.
    Cuddlycas
    14th Sep 2016
    12:24pm
    I guess we all just need to wait until January 2017 to see what will happen. As a single homeowner I was previously allowed to have $791,750 in assets/money but this will reduce to $542,500 which is a dramatic reduction of $249,250. I will probably get 12 years from my own wealth and then will have to apply for the pension - if it is still available. I have genuine fears because the government keep changing the rules and to move the goal posts after the games has commenced is very unfair. I retired last year. I have read that those who lose their pension will automatically receive a Commonwealth Health Care Card for medications however this does not give us concessions for gas, electricity, water, rates and VicRoads. These amount to almost $5,000 a year. I drive about 30 kilometres a week only so $700+ for car registration is really going to hurt. I am happy that some changes have been made for those who were really struggling but do feel that if you have worked all your life, done the honest thing and are no longer fit enough to work then there should be some genuine concessions in place. My gas, electricity and water bills are now higher because I am retired and in the house - why should I be punished for this. It would be nice to get older knowing that someone out there cares about your living standards and quality of life instead always changing the game without warning. There does to appear to be any incentive anymore to own a home or work hard. Disappointed with the government!
    Rae
    14th Sep 2016
    3:21pm
    I found out a few surprising facts(?) by reading The Senior newspaper yesterday.

    According to them you can own a mobile home or caravan and claim rental assistance for the accommodation charge in the parks.
    This could be much cheaper than buying into a retirement village foe example.

    This might make selling a house an option later.

    By selling and gifting kids early you could still achieve a pension and precious health cards when you really need then as an older person. I have gifted the kids savings a long time ago. No use them getting it when they don't need it.

    Also the accommodation bond paid to an aged care provider is still classed as your asset for centrelink purposes. How unfair is that?

    I truly believe someone should set up a private advisory business just to help people navigate through government benefits.

    Financial advisors really don't seem too clever in my opinion. They are good at selling the house's favourite investment but I've never met one yet that really understood " The System".

    There are obviously ways to get the most out of life with the least effort and worry by knowing all the lurks and perks.

    Just like a business person. First business I owned was a real eye opener believe me. They whine about tax but actually rarely pay any.

    I got my heating bill down by changing from an oil heater to an English convection heater and saved 25%. I also put in a rainwater tank to keep water costs down.

    Use your retirement to effect change and savings.

    I actually find it not only rewarding but fun as well.

    Nobody but you cares Cas. Love yourself and look after yourself.

    This nutty economic theory we are locked into actually hates savers and rewards borrowers. We have been savers and that is the problem. Now we have to be clever in holding onto that money because all those spendthrifts want it.
    Rodent
    14th Sep 2016
    4:27pm
    Dear Cuddlycas

    Are you asking what the Annual pension is for a Single home Owner at a Specific Asset Figure ie say $700,000 as ta 20 Sept 2016 COMPARED to what it will be as at 1 Jan 2017? perhaps I can help

    as an EXAMPLE at $700,000 Asset figure todays pension for Single Home Owner is $3655 pa BUT after 1Jan 2017 this will be ZERO

    Even at much lower asset figures, say $450,000 todays pension is $13405pa BUT after 1 Jan 2017 this reduces significantly to $7204pa

    Single Home owners at this $450K Asset Figure are Savaged COMPARED to all other pensioner types at that SAME ASSET FIGURE
    Old Man
    14th Sep 2016
    1:30pm
    Note to the editor. Can we go one week without having pension eligibility as a topic please? If you are having a hard time with topics you might want to ask your loyal readers to suggest some.
    roy
    14th Sep 2016
    1:57pm
    LIKE.
    Rae
    14th Sep 2016
    3:22pm
    Why don't you suggest something Old Man. Just one idea occasionally would be spectacular.
    Old Man
    14th Sep 2016
    3:47pm
    I did suggest one idea a week or so ago Rae, I suggested we leave the government be for a while and look at "Shanghai" Sam Dastyari and his contribution to the Chinese government. Lo and behold, there was a topic on just that shortly afterwards. I wouldn't exactly call that spectacular but I can say I put in.
    Rae
    14th Sep 2016
    4:49pm
    Yes I saw that today. It is a pity our political arena is gaining a reputation for corruption.

    I'd like an article on the idea of alternative accommodation.

    As I said avove you can claim the rental assistance for caravan parks so that is one idea. Another is the growing number of retirement villages that simply charge rent so there are no huge buy in fees and again rental assistance would be available.

    It makes sense to at least consider the possibility of selling up overpriced real estate. Living off $30 000 a year for five years, maybe gifting the kids and keeping the minimum amount to allow for a government pension.

    It is increasingly hard to manage investment finance with the current volatility, falling bond yields and threats to dividends and share prices.

    That government pension, discounts for health etc is beginning to look pretty good especially as a house has increasing costs of energy, rates, insurance etc that will not be able to be maintained over time.

    Alternatives to the home you own would be a good topic.
    Old Man
    14th Sep 2016
    5:43pm
    I agree Rae, whenever a discussion on whether to include the family home as an asset, there is a host of arguments on both sides. Leave aside that aspect and concentrate on what happens if a family home is sold and how it can affect a pension. Firstly, all of the proceeds will count as an asset and the pension is gone. If another cheaper residence is purchased then the balance of funds from the sale will affect the pension.

    What is needed is that if a pensioner has been in the same home for a period in excess of, say, 10 years (this time frame can be argued) and wishes to downsize that the balance of funds be quarantined from inclusion as an asset. However, any interest or similar gained from investing those funds will be counted as income.

    What I have found over many years of dealing with pensioners in a previous occupation is that the health card is the most important item that most pensioners are reluctant to lose. If sale of the family home can be allowed and retention of the health card can be guaranteed I feel that a lot more would be amenable to downsizing. Yes, I agree that it would make for a good topic but just be aware that it will be taken over by those who want to argue that the family home should be used as an asset.
    Rae
    15th Sep 2016
    7:53am
    Exactly Old Man which is exactly why considering ways to dispose of the family home before the aged care providers or government get their hands on it.

    Not content with forcing real wages down for the past four decades the bastards now just can't stand to see that ordinary workers own houses that are worth something because of of control speculation.

    The trick will be to move before they do.

    A few clever Builder generation acted to transfer homes to their kids before the government stopped it and thus saved the home from the aged care industry.

    That is another topic.

    Why is the supply of what basically amounts to hostel accommodation and minimum wage workers so expensive?

    Who is getting the money?

    I'd like to see a discussion about fixed interest investments and risk/reward trade offs. I can't believe the number of people with term deposits that think their money is safe and think fixed term is the same thing.

    The risks of fixed term investments and term deposits.

    The health card would be a good discussion. Like defined benefit schemes it appears no one can give factual information about these cards and the rules and benefits of them.

    No one can get information about defined benefit pensions correct either which is not surprising as trying to get information from the funds is nigh impossible and presented in language no one can understand.

    I'm damned if I can figure out how it can be legal for a government to change a person's non concessional % within their fund by suddenly saying it doesn't matter what it really was it is now only 10%. You would have to be an idiot to put after tax money into super now.

    That could be another discussion.
    Poppa
    14th Sep 2016
    2:18pm
    Centrelink advised last night at their free seminar ( which I attended) that the Asset Thresholds are:- for a couple Homeowners Threshold $375000 Cut Out Point $823000 your figures are a little out compared to Centrelink. Thanks Poppa
    Rodent
    14th Sep 2016
    4:36pm
    Dear Poppa

    note this reply to other poster, same issue

    Dear robmur

    the $816,000 figure is close enough, its actually $815,800

    The $823,000 figure was an Estimate the Govt gave as the cut off point when it passed the legislation in May 2015, since that time Pension increases Sept 2015, March 2016 and Sept 2016 have effected the actual figure. I am sure Centrelink will get it right, eventually
    Ok
    14th Sep 2016
    3:56pm
    It seems that the Government is trying again to punish people for saving and reward people for not planning for their retirement.
    happy
    14th Sep 2016
    8:28pm
    Just received info from centrelink. My assets according to them have increased in spite of the fact I have less in my bank accounts and my car etc have to be less value as they age. Think they are setting me up to get no part pension from January.
    Old Man
    14th Sep 2016
    11:37pm
    I got the same thing happy but as the change is <$1.00, don't think I'll bother to argue. Best to let sleeping dogs lie. I argued with the ATO a few years back and got audited 2 years out of 3. My wife got audited in the middle year. Perhaps that was just a coincidence and I'm suffering from paranoia.
    Jan
    14th Sep 2016
    11:36pm
    They reduced my pension by 0.95c a fortnight! How much does it cost to administer this change? But they won't be chasing the big end of town, which would be much more profitable.
    Rodent
    15th Sep 2016
    8:01am
    Dear all -while strictly not pensions Assets etc there is a really good doc well worth a read that SOME may be interested in- its 59 pages

    Just GOOGLE - "Strangling the Goose with the Golden Egg" - by The Institute of Public Affair
    Rodent
    15th Sep 2016
    8:06am
    Dear Fliss - back on the 27July - in this post we discussed an article by a Mr Spasic- which seemed to be confusing in what it said. I wrote to him - but never received a reply.
    No big deal
    Fliss
    15th Sep 2016
    9:15am
    Thanks for trying Rodent. Yes, I do remember.......
    Nan Norma
    16th Sep 2016
    6:14pm
    My sister spent all her money on cigarettes etc.. She and her husband wasted money, never saved, always getting a handout. On the other hand I was always thrifty. Did without a lot of things. I am now sorry as I see I gained nothing.
    Old Geezer
    17th Sep 2016
    5:32pm
    I am the only one in my family not on the OAP and don't they all rub it in with how much they get for nothing.
    Fliss
    17th Sep 2016
    10:03pm
    Yeah Old Geezer......... BUT they have to constantly report to Centrelink , etc. you are independent of all the crap. They are just jealous!!! I know whoI would rather be. ????
    mary
    21st Sep 2016
    10:24am
    Can anyone tell me if a nursing home bond is assessable and or deemable for the age pension
    Supernan
    10th Oct 2016
    1:27pm
    The thing no-one seems to mention is that those of us affected by the changes to Pensions CANNOT do much to change our circumstances ! We struggled to pay off our home at 20% interest rates. As I keep saying, we had a small business & had to stop paying our own super because the Gov decided we had to pay our Staff Super for them. So they will retire with Super, we couldn't. We also expected to sell our business & live on interest from that ! The GFC & crazy interest rates fixed that ! So yes we made plans & Gov policies unmade them. So stop blaming those of us on part pensions because we didnt provide for ourselves. How can anyone plan when the rules continually change. As war babies, we have never had 1st home bonus, baby bonuses or family supplements. We worked till we were 71/72. Yet are continually being attacked for not providing for our own Pension !
    john
    15th Nov 2016
    1:17pm
    I am quite baffled by all this pension stuff. I have to say that I have a partner who is doing 2 days work a week, at 65 I'm retired, we have an investment property that we owe over 100 thousand on, the rent only pays the mortgage on it , there is no huge profit , we own our live in home and I get a government employees pension, which is pretty small, around 980 a fortnight. All in all we get and average of about 500 dollars a week to us.
    So I guess we survive, but we have no saving to talk of , and we are week to week at the moment, my lump sum super due to a family emergency situation, has been wiped out.
    Bad luck, I know lots of people are worse off.
    But I was refused totally any part pension let alone a full one, and could not even get a health care pension card I actually applied for the pension which I thought I would not get,but to maybe just get the card and some assistance with bills .
    If this is the norm, for Australians when retiring , then we must be a very poorly served people, and I would say that when you have some assets but no real decent cash flow, then you are virtually told , you have all this stuff, but you'll have to eat the grass on the back lawn until you die.
    Now we are probably pretty OK, but its not easy , and for people who are not as prepared , as we thought we were , by the way, then god help them , we live in a wealthy country supposedly , and we want to bring thousands more into our nation, yet we can't look after all the Australians who have worked their backsides off for a lifetime , and should have an easy road to the end, but this country and its governments over the years have not provided this, and applying for a pension is like swimming through croc infested waters, just hoping to get across , but you wind up giving up half way, or get eaten , or you don't even get in the water!
    I believe the nightmarish set up through centrelink, to apply for pensions or cards is there to stop some people ever trying, I have never filled out such a complicated document , then to be told , no chance mate!
    jonty
    12th Dec 2016
    3:31pm
    You don't need to go into specifics with this or any other issue with the Conservative Libs.
    Suffice to say that Howard & Costello had a golden opportunity during the boom to save for the future but gave it all away with buying votes to stay in power; then they blame every body else for having too much, except the mega rich who they refuse to tax; and do what they always do. Bash those who cant defend themselves and slash and burn everything else.
    In today's climate and interest rates anyone with under $5000000 in working assets should not vote for them if a comfortable retirement is what you want. After all as a retiree you are less able to do for yourself and medical bills go through the roof; and your cognitive capacity declines so decision making is a lot harder. So more is needed just to get by.
    Conservative/Libs./Nats. believe they are born to rule and unfortunately so do many old folk who 'Nobly' keep voting for them.
    It's about time ideology went out of the window when voting and practical social issues were in the forefront when deciding who to vote in.
    After all we do live in a society not a Rich Man's paradise !!
    PlanB
    13th Dec 2016
    12:37pm
    What about the Government STILL deeming Pensioners to be getting 3.25% when there is NO way we can get that --- I have written to the local member AND the opposition Jenny Macklin AND the elected Chris Porter and he answered not one of my questions and just sent me the same information back that I already had -- lucky to get 1.25% or maybe a bit more with a bonus but NOT 3.25% ! That can make a big difference to a pensioner that is deemed to get that-- but isn't -- and loses part of their pension !

    We all need to get writing and complaining as it is no good just one doing it.


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