How much part Age Pension will we get?

Rosemarie could receive a part Age Pension, but she may need to reduce her assets

YOURLifeChoices member Rosemarie is pleased to find out she may receive a part Age Pension, but she may need to reduce her assets. How much part Age Pension will she receive?

Q. Rosemarie
My husband and I have recently retired and are self-funded retirees. We thought we did not qualify for a part Age Pension but were recently advised that we may indeed be able to get one. We have now applied for a part Age Pension, but it is possible that we may be just over the maximum amount. If this is the case, would it be legally acceptable to use $100,000 for home renovations? This could then reduce our assets and deem us eligible for part Age-Pension.  

Also, with assets of $1m, how much part Age Pension could we expect to receive?

A. You can use money to carry out renovations to your home at any time and this will naturally reduce the amount of assets you hold and may take you below the threshold and enable you to claim a pension.

If your claim is rejected in the first instance due to your assets being too valuable, you will have to wait until you have spent the money on renovations before asking Centrelink to reconsider your claim.

The amount of part Age Pension you receive is not only based on the assets you have. It is also determined by your income. For each dollar of income you receive over the income limit, which is currently $268 for a couple combined, your pension will be reduced by 50 cents. In terms of the asset limit, your Age Pension is reduced by $1.50 for every $1000 over a certain threshold, until you reach the disqualifying amount. You will need to speak with a Centrelink Financial Information Services officer to ascertain what your payment rate will be. 

As self-funded retirees, if you do not qualify for an Age Pension, you may be entitled to a Commonwealth Seniors Health Card (CSHC), which will give you access to concessions on pharmaceuticals, medical services, transport to name but a few. Also, as holders of a CSHC, you may also be eligible for a Seniors Supplement to assist with household bills.


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    23rd Oct 2012
    You must be kidding!!!! Wanting a Government handout with those assets?? Greece here we come!!! Are people that greedy??? Shame!!!
    23rd Oct 2012
    it rather depends on what the assets are - if this person is including the family home in the count then that is not counted in the asset limit - you cant eat a home
    Precious 1
    20th May 2015
    I said my speak re this one...I think people in generous living circumstances should start thinking of all that they have already received and look at the enormous amount of money the Govts of the day and others have to spend on firstly keeping us safe in our homes no matter how modest.........I feel now is the time to re calculate and receiving borderline amounts of money which I do know many many out there are receiving start thinking of what they can live on and disclaim other amounts....I know even the Queen can receive a pension.....we do not live in a hugely populated country and there are far too many people here already NOT working or if they are not declaring it...........that is the problem.......
    Alida Talbot
    23rd Oct 2012
    23rd Oct 2012
    btw, the amount of assets one has can affect the rate of pension - the amount is worked out under both the asset and income test and whichever test produces the lesser rate is the one
    23rd Oct 2012
    ooops, is the one applied to the claim
    Debbie McTaggart
    29th Oct 2012
    I have amended, thanks for your comment
    23rd Oct 2012
    Yes Grateful, once again the GREEDY take from the needy. One reads soooo often of these self funded retirees asking for ways to get a part pension (a few dollars a week). They don’t need a few dollars a week and if they kept their greedy paws out of the trough maybe real pensioners could get the extra. They have no concept of living (no existing) on $20,000 A YEAR for singles, let alone $30,000 for a couple. – whose pension was increased by $12 this last six months – imagine what the greedy get in interest over six months!! It’s high time the threshold was lowered so the greedy with their million dollars aren’t eligible for any pension.
    29th May 2015
    I suppose you mean the needy who have spent everything every week, played the pokies , smoked and drank. had more clothes than an op shop and more dinners out than at home . Why do they deserve!!!!!!! I worked ate at home and did not smoke and drank little SO I COULD HAVE A RETIREMENT DOING WHAT I WANT INSTEAD OF WORKING now tell me I do not deserve. HA HA HA
    23rd Oct 2012
    There you go again grateful, begrudging people getting a return on all the taxes they paid during their lifetime.
    They probably worked hard, saved, and made the right choices and now have some assets.
    What made you so bitter?
    23rd Oct 2012
    Get real retroy. I am not being bitter. The pension is there for unfortunate people, probably for reasons way out of their control, to get life's basics. The pension is not an ENTITLEMENT it is not a REWARD for having paid taxes. You have got it all wrong. Pensions and benefits for those that cannot support themselves without help. Someone who saysa we have $1 MILLION in asdsets, how mush will we get. UgHHHHH. Anyone should be a self funding retiree, but, VERY MANY through illness or financial disasters like the GFC which was NOT THEIR FAULT, have to be protected. Or, do you think that we should all be like India and Russia where if you have suffered misfortune then STIFF baby,
    get real retroy, let's SLASH the entitlement limits and give our benefits to those that NEED them not those millionaires that think that they are ENTITLED to them!!!
    You are assuming that GENUINE pensioners haven't worked hard and made the right choices. WHAT A SANCTIMONIOUS SELFISH VIEW. SICKENING!!!! And when you later say that "those that have WORKED HARDER, Gee I'd love to meet you in a dark alley! You are a disgrace. You belong in Nazi Germany!!!!
    24th Oct 2012
    Before launching with more vitriol and evidence of your bitterness towards people with money, you should read comments properly. Nowhere did I say that pensioners made wrong decisions or did not work hard. Also where did you get the notion that I wanted this country to be like Russia and India and I did not want the needy to get the pension.

    You assumed that is what I meant, so by your own rule you definitely qualify as an ass.

    I belong in Nazi Germany, indeed what an inane comment.

    Auf Wiedersehen Schwachkopf

    When I was young, pensions were something the Govt said it would pay you as a reward for diligently paying your taxes, but now they have renegged and you and your left ilk support the new notion.
    23rd Oct 2012

    This statement of yours "The amount of part Age Pension you receive is not based on the assets you have. It is determined by your income" is WRONG. ABSOLUTELY WRONG.
    There is both an income and an assets test.
    Please correct what you have said.
    Debbie McTaggart
    29th Oct 2012
    Thanks for the comment, has been amended
    23rd Oct 2012
    Grumpygran you obviously do not know the earning limit for self funded retirees (those that worked harder and saved for their retirement) to qualify for the CSHC, has not been increased for 11 years while the pension has, so who is being short changed ?

    23rd Oct 2012
    Spot on Who Genimi....Debbie's reply was incorrect. Experts are required to give correct information ...I am surprised at a cpl of responses on this site from so-called experts. You need to go to the source or have a look at the website for the correct info, or seek specialist advice from a financial advisor with Centrelink knowledge.
    Debbie McTaggart
    29th Oct 2012
    Article amended.
    23rd Oct 2012
    How rude to be even considering a part pension. If I had 1million in assets and 100,000 to use on house renovations I certainly would not be applying for a pension.
    23rd Oct 2012
    What a nerve to call these people greedy.

    I can remember paying 48.5% top rate income tax on a fairly modest salary - they probably paid even more - and the deal was that in Australia Social Security (as it is called elsewhere NI in the UK) was rolled into that amount and that the age pension wa what you got as of right for working and paying tax all your life. In just about every other country in the world (including eg New Zealand and the UK) that's how it works. Australia is a spongers' paradise. Enter Australia and sit on your backside for 10 years and you will have exactly the same age pension entitlement as I've got after a lifetime of working and paying tax here.

    Over the years the pollies (of both parties) have chipped away at the age pension so that they now try to brand it as a social security safety net only for those of limited means (no need to be deserving poor).

    It's a disgrace. We've all been ripped off. They moved the goalposts after the race started (to mix a couple of sporting metaphors). Now hard-working individuals get spied on by centrelink snoops to see who their sleeping with while the spongers get afree ride.
    25th Oct 2012
    I agree, the goalposts were shifted after the race started. I don't give a rats if someone has $1m in retirement funds, more power to them and congratulations on the hard work they have put in to get there. As a self-funded retiree she is saving the government much more than the few pennies she is entitled to which means there is more money to fund those who have not been so fortunate. I think her question is perfectly reasonable.

    I have been thinking that it is perhaps the psychology of the issue, rather than greed as some have implied that prompts Rosemarie's question. We are defined by the term pensioner. Somewhere way back when, it wasn’t a dirty word, it used to mean that you had done your bit and the pension was a salute to the hard yards you had put in. Perhaps ‘Rosemarie’ just wants recognition for her hard yards.
    23rd Oct 2012
    BTW the "advice" in the article is nonsense. There's an assets test (as well as an income test) - the worst result from the two is applied. With current rates of return the assets test is often the harshest.

    Ex-government employees with old style final salary related pension but still eligible for topping up with a part pension are at an advantage because no asset value is imputed against their income stream.

    Well - fancy that.
    Debbie McTaggart
    29th Oct 2012
    Thanks for your comment, this has now been amended
    9th Dec 2012
    That would be a defined benefit scheme.
    23rd Oct 2012
    Re assets test - apologies for not namechecking others who pointed that out earlier.
    23rd Oct 2012
    Call it what you like Adbob, the fact is that the "asset test" is FAR too generous and should be slashed by half at least. What government has got the guts to do that when you have got millionaires like Rosemarie EXPECTING to get MORE???? What a sick and sorry world we are developing. An Age pension is not a super fund as a reward for paying tax, it is , because, for whatever reason, you are aged and with VERY limited funds to support yourself. Tell me Rosemarie, what would you do with your extra couple of dollars from the Age pension? Make you sleep better at night? Trade up to a Lexus instead of a Toyota? What do you think of the genuine poor peple who desperately need help often through no fault of their own and can't get a couple of extra dollars increase in their pension because the Government has to give it to you and your like greedy friends???
    I hope you enjoy the look of that person in the mirror each morning.
    23rd Oct 2012
    I agree rich people should not get the pension - but neither should those that smoked, gambled and drank their income throughout their lives. So who is going to check each person's lifestyle to see if they really did it tough or just cruised through life and are now wanting a bigger slice of the pie.
    23rd Oct 2012
    Mary's comment is spot on. While most people getting the pension genuinely deserve it, it's rarely mentioned that there are many thousands who reach pension age with nothing because they have been irresposible their whole lives.
    I have known people who earned pretty good money for decades but lived in the fast lane and reached 65 with almost nothing. I know it would be impossible to police but do they deserve the pension?
    23rd Oct 2012
    The simple fact remains that in virtually every developed country in the world except Australia (eg look at NZ - just next door) the basic pension (provided one has the normal history of mandatory social security contributions through working - partly paid by the employer) is for everybody, rich and poor alike, as of right. Obviously the rich have paid much more into the pot but are only drawing the same amount as everybody else.

    Brian Toohey in the Financial Times, has for a long time been running the argument that it would be cheaper for the govt to remove the tax breaks (just income tax) for super and give everybody a full pension.

    This thread seems to be dominated by people who (one assumes) have little enough savings for this means testing not to apply to them and are jealous of those who have worked and saved and who now face a massive poverty trap which will, if they live long enough, reduce them to the same financial level as those who didn't. Obviously there are deserving cases who are poor for no fault of their own but they are much fewer in number.
    24th Oct 2012
    Adbob, have you never heard the saying that ASSUME makes an ASS out of U and ME?? Well, you've done it again!!
    Try getting cancer at 63, losing your income, then losing 3 businesses due to the GFC while you are trying to stay alive and not being able to do anything about it. Paying all of your assets, including the proceeds of the sale of your home, to the unfortunate employees who lost their jobs through no fault of their own, just those greedy bankers, and being left with 10 more years of paying off loans which the banks still insist on recovering.
    Sure, I could have declared bankruptcy 4 years ago, but, I don't take that gutless way out like many, so called, "rich" people who walk away from their debts and obligations and then proceed to start up another business!!
    Jealous of rich people??? Been there done that for 40 years. It is not about jealousy, it is about basic care for those that have no other way of caring for themselves, while people who have had either the better side of life's gifts (certainly better than most genuine pensioners) or have worked hard to earn what they have got, are not satisfied with their great fortune and would prefer to have more at the expense of the genuine needy. People with Rosemary's great situation should be looking at GIVING not TAKING.
    And do you realize that when you generalize with your rhetoric statements that you paint everyone with the same brush!! VERY unkind and hurful to many.
    23rd Oct 2012
    It makes sense that all people of retirement age should have access to a State pension, regardless of their assets. Australia has had a PAYG tax system for a very long time, so the more one received in earnings, then a higher tax rate was applied. So in effect the Government is double dipping by not allowing SFR's to claim a full pension and other benefits. Personally I would not resent them doing so, as many who have commented here seem to do. I have a few assets, which I managed to accumulate, through being thrifty during my woking life, so as to have a little comfort in my retirement years. At the same time I recognise that my contribution in taxes, because of lower earnings, was significantly lower than others. I do not expect the SFR's again to support me because of it. That is grossly unfair.
    24th Oct 2012
    Divide and conquer. How true. I have not witnessed such rude personal attacks and threatening comments than those directed at persons with opposing views on pension entitlements. Shame on you “grateful” and others.

    Here is a fact that you might or might not want to hear depending on your uninformed points of view.

    Full pension for a couple $1073.40
    Add in pension supplement of $91.40
    Maximum rent assistance $113.80
    Allowable income not affecting pension $268.00
    GRAND TOTAL $1,546.60 per fortnight or
    $40,211.6 per year. This is more than many people can earn in a year doing full time work.

    If a rich couple had over a million that is $1,005,290 invested at 4% (that’s all you will get for monthly paid interest) the return is $40,211.6 in a year. That’s right the same amount as the pensioner. BUT they do not get reductions on council rates, car rego, public transport etc. etc. These people would be stupid not to spend a big chunck of their hard earned money, and if they do they will be entitled to a very small income supplement (pension) until they have spent it all, and they are entitled because that is the law.

    Do not get angry at each other – reserve your anger for the architects of this inequitable system.
    24th Oct 2012
    Imagine, if you are going to quote one side of the story, firstly take out that $268.00 "allowable income." That is NOT part of the pension and the vast majority of age pensioners can't "earn" that extra income and GROSSLY distorts your argument.
    And, when you look at the million dollar asset holders, if any of that comes from a lump sum super payment, even an accumulation of superannuation payments, tell everyone that 60% of that has come from Government contributions in the form of massive taxation concessions. And they do not have to pay ANY tax on their superannuation after 65 and NO CAPITAL GAINS TAXES on profits on capital item sales!!! And you say that the poor age pensioner is getting all of the icning.
    And most of those on nearly the maximum income and assets levels and are receiving a few dollars in pension still get ALL the benefits and concessions that you mention through their PHBC.
    Be careful spreading one sided stories.
    It is NOT a one way street when it comes to "welfare"!!
    18th Mar 2018
    Thanks for an objective response Imagine.

    Grateful has been dealt a bad hand, admittedly, but that doesn't excuse his bitter, nasty tirades.

    We only accumulated super in our later working years. Not enough time for a worthwhile amount.

    We put our savings into bricks and mortar then sold to fund retirement (after paying capital gains tax). We have funded ourselves since 2012, but low returns and diminishing funds will see us applying for part pension this year.

    We have used our money each year to live because interest rates are low and we lost a big chunk of super value in both big corrections in the years prior to retiring.

    After 50 years of working hard (in our early married years, 2 jobs each), paying taxes and never receiving unemployment benefits if a job was lost, just buckling down and finding new work, we feel we have earned whatever amount we might be entitled to.

    We raised three terrific kids, who have our hard work ethic and are now paying their mortgages and raising their families.

    They have always sought work and never had their hands in the public purse, so I hope that when their retirement time eventually arrives, the government has sorted itself out and able to honour a pension for they promised in our youth and then reneged after mismanaging our economy!
    24th Oct 2012
    @imagine - Thanks for those figures - that's exactly what my calculations show. And not only that - your capital is being eroded by inflation while you are being taxed on the so-called profits. Above about $300,000 savings are worthless as the means test removes any benefit. The only way to preserve your savings is to have most of it in your private home, which is what the original questioner was asking about. This of course means, in retirement, having a much bigger home than you might realistically want.

    Solid gold taps - anything - just put your dosh into your home. A smart thing is solar panels as that takes some assets out of the assets test and reduces your outgoings.

    If Grateful thinks that any savings accruing from attacking part-pensioners is going to end up in his (or her) pocket (s)he must be living in cloud cuckoo land. It'd just reinforce the pollies' believe that age pensioners in general are a soft target to be taken to the cleaners at every opportunity.
    24th Oct 2012
    Get it right adbob. Rosemary has $1 million in cash over and above her home. And, how do you enjoy a quality lifestyle if all of your assets are tied up in your home? Try paying for holidays, new cars etc etc using your home.
    When we start getting close to Greece which inevitably we will with everybody sticking their snouts in the "welfare" trough and all of our rich people getting government benefits, which brave government will re-introduce PROBATE DUTY!!! Or a super tax on the sale of the family home?? It's been done before and the way governments are getting desperate to balance their budgets, they will be looking at such obvious targets to do so again. Hockey has already stated very clearly that the "Entitlement game' is over and if he is like nearly all previous Liberal Governments, the first thing that he will be looking to cut is "middle class welfare." His words and hopefully he will have the guts to do it, as this government won't as it is so desperately trying just to stay in government.
    We need a government of either persuasion that has an absolute majority in both Houses to have a complete clean out of all lurks and perks that have been introduced as vote buyers by both parties and are now ruining our economy.
    And you say that "Above about $300,000 savings are WORTHLESS' as the means test removes any benefit"!!! Some people should get into the real world, especially critics of the unfortunate. If you want to get those "benefits" then you can always donate that $300,000 to a charity and it would be a win/win all around. Bet you don't!!
    24th Oct 2012
    excuse me but are the moderators reading this thread? we have not as yet had a comment from Debbie about the asset test error?

    I guess no matter what a person's income is in retirement it will not satisfy! If one had sufficient assets to bring an equivalent income to age pension one would probably still have to pay tax and then that would reduce the value of the income, and as has been pointed out, you might have an equivalent income but you would not have the reductions on rates, etc so you would then have to use your capital which would reduce your capacity to earn the income to be self funded, etc etc - a vicious circle really. In one sense I feel that if I have a sufficient income that I did not qualify for a pension I would consider myself fortunate - but if that income was only just over that cutoff I would wonder if the reductions in prices of things with a pension card would be more valuable than the little bit of income over the cut off. Has anyone worked out recebtly just how much in money terms that card is worth? when it qualifies you for free dental, medical, cheaper rates, cheaper this, cheaper that?
    24th Oct 2012
    I don't know the answer to that. The general advice seems to be that it is worth trying to qualify for a part pension, however small, in order to get these various entitlements but what they are really worth I am not sure and it may depend on how much you are accessing the health system.

    The present system is invidious. Under the present system one can see the attraction for very well off people to downsize on their family home and maximise on their income producing investments in order to be free of the curse of centrelink. But then (as has happened recently to many people), when those investments fail to perform, they find themselves needing a part-pension and wish that they'd done the opposite.
    25th Oct 2012
    I posted a comment to illustrate how an aged pensioner on full entitlements is not much worse off than a low paid worker or a person who is a self funded retiree with one million dollars and I am accused of spreading one sided stories and believing pensioners get all the icing. Please re-read my comments, as no such implication was made.

    My argument was that I was disturbed to read of “belong in Nazi Germany” “meet you in a dark alley” “greedy take from the needy” etc. Why the pointless, aggression, it serves no useful purpose and will not act as an agent for change.

    On a different topic because Grateful raised it, Capital gains is a somewhat historical concept, I have suffered 30% capital losses on my meagre investments since I retired in 2000 – so not much tax there. Even if the ‘millionaire self funded couple‘ payed 40% tax on their earnings of $40 000 it would reap only $16000 so it would take two self funded couples to partly support one full pension couple and the self funded investments would run out much quicker. The ‘bean counters know this and that is why there are tax breaks. They want the self funded to last the distance because the country cannot afford to pay the increasing number of aged, with continuing longevity, a reasonable income support. Remember that the Government has NO MONEY it simply takes from those who have, and distributes it as it thinks fit.
    My point remains, a person is not greedy because they claim entitlements, and no amount of bad mouthing will change the situation.
    29th Oct 2012
    Australia's self-funded retirees like to claim that they don't rely on the Government to help them out but a report released today says it’s not true. Tax concessions to SFR will cost the government $45 billion in 2015, almost twice as much as the aged pension.
    World Prophet
    14th May 2015
    Below an interesting history posted some time ago by another user:

    1944 Labor Prime Minister Ben Chifley introduced three Bills to establish the National Welfare Fund, to be financed by a compulsory contribution levy of 1 shilling and 6 pence in the pound on all personal income.
    Opposition Leader Robert Menzies stated that the compulsory contribution levy should be kept completely separate. That it should be shown separately on the taxation assessment and paid straight into a “Trust” account, and not mixed with the general revenue. Menzies said, “The stigma of charity should be removed from the Age Pension. It should be an entitlement earned by the person's personal contribution to the fund.”

    Prime Minister Chifley agreed and established, as from January 1 1946, the National Welfare Fund – a “Trust” fund with the Parliament as “Trustee.” The compulsory contributions levy commenced on January 1 1946. It was shown separately on the personal tax assessments for 1946, 1947, 1948, 1949 and 1950, and the compulsory levy was properly paid straight into the special “Trust” fund, and welfare claims were paid out of the fund. The balance in the fund for 1950 was almost 100 million pound.

    In 1949 Robert Menzies became Prime Minister, and he introduced Bills to amend the Acts governing the National Welfare Fund. The compulsory social contributions levy was then grouped with the taxation assessment and appeared as one amount on the taxation assessments, and was paid as one amount straight into Consolidated Revenue. The sabotage of the National Welfare Fund had commenced. The opposition Labor Party had collaborated in this sabotage by remaining silent instead of opposing Menzies' action.

    From 1951 to 1985 the compulsory levy of 7.5% (now included in the tax) continued to be collected and placed in Consolidated Revenue, and treated as general revenue and spent, until 1985.

    Labor Leader, Mr. Whitlam, abolished income tests for all persons 70 years of age and over, and paid pensions to all people over that age.

    In 1976 the newly-elected Coalition Prime Minister, Malcolm Fraser, cancelled the Whitlam achievement of abolishing the tests for all who were 70 years and over.

    In 1977 Malcolm Fraser, with Treasurer Philip Lynch, transferred the balance in the Welfare Fund account (approx. 470 million dollars) to the Consolidated Revenue account.

    In 1985 the Hawke-Keating Labor Government repealed acts Numbers 39, 40 and 41 of 1945 (the National Welfare Fund Acts). Thus the funds finally ceased to exist.
    Yet the 7.55 levy continues to be collected as a proportion of the Income Tax Revenue. It also introduced the much-maligned Income and Assets Test, thereby excluding millions of levy and tax-paying Australians from receiving Social Services pensions.
    This money – these self-funded contributions – paid as a percentage of the total income tax collections – are to-day worth more than the amount of means-tested pensions paid out. Actuaries have calculated the non-means-tested ENTITLEMENT due to EACH retiree to-day is in excess of $500 per week.

    In other words, if they had left the original scheme in place, EVERY pension age person would receive in excess of $ 500 per week, irrespective of assets or income.

    If you want to direct criticism at anyone, direct it at the politicians, who have sold us down the river for many, many years in many, many ways.
    19th May 2015
    Boy, is the green eyed monster alive and well!
    I also get a small pension payment which supplements my income from being a self funded retiree and I accept this without any feelings of guilt, having paid taxes for all of my working life.
    I also get a rebate on my health insurance policy which I have also held for around 50 years, which also irks many in the community who made no provision for funding their own health needs, and are probably not interested in the fact that in the last five years taxpayers have contributed around $8,000 towards my health insurance, which has saved the taxpayers around $80,000 in hospital bills.
    The system for assessing eligibility for pensions should continue to exclude the family home up to a maximum value, anything above that value should be counted with other assets.
    8th Jan 2017
    How much of a living wage will a pensioner receive. You are joking. This proposal is to control money and reduce what the government will pay, e.g. 25% of a minimum wage?
    8th Jan 2017
    comment re the government would pay a pension as a reward for a life of work contributed to society is not quiet correct. A portion of you tax was supposed to be set aside to pay a pension, so you really have paid for your right to a pension. Instead of putting this money into a separate fund the government put it into consolidate revenue and used it for it own agenda. That is what has happened also to sup funds. Don't be bamboozled.
    19th Jul 2019
    I believe all tax paying people when they reach pension age should receive a Pension or at least a pension card or CSHC at least they can get some of the discounts etc. Fair thing for all
    don't you all think...

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