YOURLifeChoices subscriber, Jeff, would like to know how best to structure his post-separation funds and how to achieve his dream of a life on the water.
We have just sold our house and have decided to go our separate ways. My wife wants a studio apartment and I want to live on a boat. We shall each receive about $170,000. We both receive the Age Pension and a small UK pension. I want to spend as little as possible on my boat and put the balance of my share in a term deposit. I know I can get rent assistance with the marina berth cost but if I am to lose the pension, it is not viable. It is also not viable if I spend a lot on the boat, as I would not have enough to pay my rent. I guess my wife will be in the same boat, no pun intended. How much can I spend on the boat and how much can I put in a term deposit so I lose only the minimum in pension entitlements? Rent at the marina is approximately $160 a week. Would this be a question better suited to an accountant?
A. Provided by Centrelink
There are many people who receive income from investments and/or employment but who are also entitled to a part-rate pension payment.
Broadly speaking, a single person who would otherwise qualify for the Age Pension can receive income of up to $1,485.80 per fortnight, before they lose their entitlement to a part rate pension. If it is derived from employment, the cut off is even more generous as only half of the first $500 per fortnight of employment income is assessed.
Under the assets test, single homeowners with less than $626,000 in other assets (not including their family home), will also generally be eligible for a part-rate pension.
If you’re not sure what you might be entitled to receive, the best thing to do is to apply. Simply call 13 2300 or visit your local Centrelink office. Don’t self-assess or make assumptions about what you may or may not be entitled to. Everyone’s situation is different.
It’s important to remember, that if you’re finding things difficult financially, Centrelink has a Financial Information Service available at no cost, whether you’re a Centrelink customer or not. They are available by calling 13 2300.