A YourLifeChoices reader on the Disability Support Pension is approaching Age Pension age and wants to know which payment would result in him being better off.
I am currently on a Disability Support Pension (DSP), and become eligible for the Age Pension in April 2024.
I’m trying to determine if it’s financially better to stay on the DSP or go across to the Age Pension. Depending on who I ask I get varying opinions, many of them anecdotal.
A. We can’t give Kim a definitive answer, because a lot will depend on his circumstances – such as extra payments and allowances and his marital status – which he has not laid out in his letter.
At a basic level, the payments for both the Age Pension and the Disability Support Pension are the same.
However, you may get a higher rate of payment through the Age Pension because it has more generous levels for the income and assets tests.
You will also be eligible for the Work Bonus scheme.
Recipients of both payments are eligible for a Pensioner Concession Card (PCC), which allows you access to cheaper medicine, bulk-billed doctor visits and help with hearing services.
The attraction of switching to the Age Pension is you get the same money, but no longer need to have your disability assessed.
You can also travel significantly longer on the Age Pension and still be paid. DSP recipients can only travel for 28 days in a 12-month period. After that their payments may be stopped.
People on the Age Pension can travel for up to 26 weeks in a year. However, after that the amount of pension payable depends on the length of time they had residency in Australia.
Some payments will stop if you transfer to the Age Pension such as the Pensioner Education Supplement and rent assistance payments also vary between the two pensions but, generally, there is a higher rate of Rent Assistance on the DSP.
If you have been invited to apply for the pension, regardless of your decision, you must inform Centrelink about your superannuation. If you fail to do this, Centrelink may stop your DSP once you reach pension age.
Have you ever switched pensions? What motivated your decision? Why not share your experience in the comments section below?
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