Will more super affect my pension?

Would extra super payments be assessed by Centrelink and affect the Age Pension?

Will more super affect my pension?

Lyn has been unable to accept a pay increase as it would affect both hers and her husband’s pension, but would extra super payments be assessed by Centrelink?

Q. Lyn

I work full time and get a part Age Pension under the Work Bonus scheme. My husband is on a part Disability Support Pension as well.  My boss offered me a pay increase this year but I had to turn it down because after tax is taken out of the increase and our pensions are reduced, our fortnightly income would be less than we get now.

My boss has suggested that the firm pay me a higher rate of super to at least give me some benefits – would this action affect my pension and, if so, by how much?

A. Whether or not your pension is affected depends on the level of assets that you have. As you are passed Age Pension age, your super balance is included in the asset test and, therefore, any increase in this balance would mean your assets will increase.

By how much your pension is affected, again, depends on your overall asset value. Pensions are reduced by $1.50 for every $1000 over the asset thresholds.

You can find details of the current thresholds here.

Before agreeing to any increase in super payments or salary, I suggest that you consult an independent financial adviser to fully assess your overall financial position and how you can best utilise allowances available to you.


    To make a comment, please register or login
    16th Dec 2014
    And this type of question illustrates just how much people have their hands out for government welfare. Here we have someone working full time, being treated well by their employer and being offered a pay increase yet prefers to remain on the Government handout rather than negotiate 1)bigger pay rise to cover any immediate shortfall, or 2) seek proper financial advice as to how her employer can reward her work to her advantage. The employer in the example seems more than willing to find a solution yet is being rebutted.

    Surely if a person is already over the super preservation age (or retirement age) they can start a transition to retirement process. They can draw down the minimum amount - typically 4% per year from the existing balance, and salary sacrifice (at a lower tax rate) into the super fund leaving more in their pocket and build more for the future. This way, if such a person got proper advice, they may be able to accept the rise, stop the part pension and still be better off now and into the future.

    Rather than the implication that such a person should preserve their current pension, surely it would be better to advise how such a person can make more of their current and future financial situation whilst at the same time reduce their reliance on the Government pension.

    And still welfare rises. I wonder why?
    13th May 2015
    Continuing to work well past retirement age means one less job for someone who could be gainfully employed.
    29th Jun 2015
    I agree and the amount of young people out of work is not good for the future. Do Governments not understand they have to train and put to work young people as it is the young that will be paying the taxes in the future.
    27th Mar 2016
    Age pensioners continue to be hammered by those we employee MPs its, time we removed the so called life time forms of pensions and perks from MPs when they are no longer how employees MPs, this action should save some millions of dollars and bring them in line with all other employees across this nation.

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