How will Age Pension changes affect you?

There is one step people can take to reduce their assets tested.

an older man with his grandchild on his shoulders

January changes to the asset thresholds have left many Australians wondering how they can reduce their assessable assets to ensure they still receive an Age Pension.

On 1 January 2017, the Australian Government implemented changes to the assets test used to calculate age pensions. These changes have been widely reported in the media, and can be a little intimidating when trying to understand what they can mean for individuals, couples and their families. 

The new changes include imposing new asset limits. These limits will not affect everyone, but there will always be people on the borderline who need to make sure that the new rules do not adversely affect their entitlement to an Age Pension or their Age Pension amount.  

Mandy Cooper, Chief Executive Officer of the Australian Friendly Society states that one step people can take to reduce their assets tested, is to purchase a funeral bond.

A funeral bond is a capital guaranteed product designed to finance funeral expenses.

In this financial year, investments of up to $12,500 (indexed annually) in a funeral bond, such as the Bendigo Funeral Bond, are currently exempt from the Centrelink and the Department of Veterans' Affairs (DVA) Income and Assets Tests.

Funeral bonds are typically bought by people approaching retirement, entering retirement living or nursing care. People may choose to assign their bond to a funeral director as part of a pre-paid funeral arrangement.  

“As well as being exempt from income and assets tests, a funeral bond may provide peace of mind for you and the people closest to you at what can be an incredibly stressful and upsetting time" Ms Cooper concluded.

The Bendigo Funeral Bond is issued by Australian Friendly Society Limited ABN 29 087 648 851 AFSL 247028, associated with Bendigo and Adelaide Bank Limited ABN 11 068 049 178 (the Bank) and its related entities. It is capital guaranteed by the Society, it is not a deposit with, guaranteed by, or liability of the Bank or its related entities. This article include general information only, you should consider your situation and read the Disclosure Document before making a decision.


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    Alida Talbot
    27th Feb 2017
    what a joke
    27th Feb 2017
    27th Feb 2017
    How about an offshore tax shelter? Turnbull has one. Family trust? Expert opinion needed on these so can the writer of this piece weigh in or is he/she just flogging something?
    1st Mar 2017
    Mick, you missed the writing in blue under the picture.


    Of course they are flogging something.

    Why did you bother reading it???
    pedro the swift
    27th Feb 2017
    Why would anyone bother with a funeral bond/insurance. Money wasted as far as I am concerned. Don't really care about how my funeral is aranged. I'll be long gone!
    27th Feb 2017
    Age pensioners will never forgive or forget this LNP Government for changing the assets test, and stuffing up their retirement...Just wait until the next election, and they will be kicked out.
    Gee Whiz
    27th Feb 2017
    As of the polls today, the Tunbull shysters are so far behind the eight ball they will never recover. And while One Nation has shot up the polls Labor is still ahead.

    I just hope people realize Labor is nothing more the the LNP painted a different color.

    Shorten agreed with Turnbulls attack on the pension and superannuation. He has clearly stated that Labor will not be rescinding any of the legislation that attacked pensioners or self funded retirees.

    A vote for Labor is as good voting for Turnbull. They are identical twins.

    Both of these parties must suffer the wrath of the people. They have robbed the Australian people for far too long.

    They deserve nothing more than the political wilderness and now is the time to boot them out.
    27th Feb 2017
    Perhaps Thommo forgets it was a liberal government who gave significant increases to the threshold in 2007 - so thank the libs for giving you at least 10 years of additional pension payments.
    And don't forget Labour voted in favour of the latest changes
    28th Feb 2017
    LNP may well lose the next election but unlikely it will be the result of outraged pensioners turning on them. What proportion of voting pensioners that voted LNP last time are registered in marginal seats? How many will actually change their votes and will it be enough to influence the election outcome?
    28th Feb 2017
    LNP may well lose the next election but unlikely it will be the result of outraged pensioners turning on them. What proportion of voting pensioners that voted LNP last time are registered in marginal seats? How many will actually change their votes and will it be enough to influence the election outcome?
    27th Feb 2017
    I agree 100% with Pedro, Thommo and Gee. Wonder what party if any would be an acceptable alternative?? Would it be P Hanson ?? Any suggestions ??
    27th Feb 2017
    Pauline also suppoted the Assets test so she is no better than the rest
    27th Feb 2017
    While she is in favour of increasing the full pension rate, she is not as supportive of part pensioners. Pauline is also supporting the cuts to welfare before the Senate ie youth allowance rather than higher Newstart for under 25. . She is all for small business, hence her support for the drop in penalty rates for Sunday's and Public holidays.
    27th Feb 2017
    We don't mind taking a cut to our retirement income if it is for the good of the country but what about the big end of town having a cut to their obscene income they just keep getting richer.What a pack of dills Australians are.Thank god I didn't vote Liberal so I am not to blame.
    28th Feb 2017
    I totally object to having decades of planning stuffed at the last minute. I do not intendto take one for the damn country and the wealthy at all.They are the idiots that caused the problem in the first place through their greed and superiority notions. I will never vote LNP. ALP. Greens or Hanson ever again.

    Bunch of lying betrayers. They have sold our country from under us.
    27th Feb 2017
    Totally agree with all the comments, Labour the same as Liberal, both rife with expenses Rorts, and as for the Greens, they agreed to this as well, while no asset testing for them.
    27th Feb 2017
    Hi Everyone
    So we have a situation where
    - Pauline supported the Assets test so she is no better than the rest
    - Labour the same
    - LNP same, both rife with expenses, rorts etc
    - the Greens they agreed to this as well
    So what now is the alternative; if any ?
    e.g. do we start a new party ?
    stone age
    27th Feb 2017
    Its time to go on a big overseas holiday.
    Old Dog
    27th Feb 2017
    Funeral bonds would not do me much good. I have arranged for the mortal remains to go to a university for up and coming Doctors to practice on. They look after expenses.
    28th Feb 2017
    Are they your wishes or have you actually made arrangements. I heard from a friend that when they tried they had so many people wishing to do just that that they rejected their request.

    Funeral bonds if you are near death may be a good idea however giving money away too early would be saying goodbye to a disposable income and I am sure funerals didn't cost $12K 20 years ago.
    27th Feb 2017
    Hockey called disabled rorters and smashed the retirement plans of thousands who worked and saved for their retirement, whilst the Bastard rorted the travel allowance and filled his back pockets. The funeral bonds are a joke. I voted for the Bastard Liberals for the last 45 years, now I vote Pauline Hanson
    28th Feb 2017
    The change in the assets threshold legislation, which came into effect on 1st January 2017, was voted in by the Parliament in 2015 when Tony Abbott was still PM. Labor voted against this. It got up because the Greens voted for it with the LNP.
    28th Feb 2017
    It is now pointless to accumulate assets that return no income. Or to declare them.

    Make sure you gift that Mobile home, boat or caravan to the kids 5 years before you need a pension and do not update the car like in the past. Keep the old one until after the application is approved.

    Be realistic in valuing household stuff. It usually isn't worth much at all, certainly not the replacement value you insure for.
    28th Feb 2017
    Just the Government ALL of them ripping more off us, they are ALL scum!
    12th Mar 2017
    All of you bagging the Labour Party need to remember it was The Liberal Party combining with the Greens, NOT Labour, that put these through in late 2015 leading to assett tests changes and income changes a year apart on Jan 1st, 2016 and Jan 1st, 2017. The Coalition and Labour ARE different. It i simplistic to say otherwise. Labour opposed these changes. I know this because I lost $350 a fortnight from Jan 1st 2016 on. This has really affected my wel-lbeing, I can assure you. Also I was very upset that the Greens were the ones to get this through Parliament as I sometimes voted for them. As a matter of opinion, one negative issue would not stop me voting on principle for any of these 3 parties, depending on the issues at stake rather than voting in largely untried or extremist small parties.

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