Increasing your super pension

Ellenora is considering upping the amount of pension she receives from her super, but is wondering how this will affect her Age Pension.

Q. Ellenora
I am in receipt of my super pension of $2500 a month.  I am 70, plus I receive an Age Pension of around $560 a fortnight.

I want to increase my super pension to $3000. How will this affect my Age Pension? 

A. Once you have reached Age Pension eligibility age, which you have, superannuation or an associated income stream is assessed under the income and the asset tests. Under the asset test, it’s the amount you hold in super or have used to purchase an income stream that is assessed. Under the income test, it’s the amount of income deemed to be earned, not the actual income, that is assessed.

You may therefore find that by purchasing another income stream to increase your monthly pension payment, the amount that is assessed under the income and asset tests will not actually change, and therefore your Age Pension payment may remain roughly the same. It will depend upon the resulting lower amount of payment (from Centrelink) once the income and asset test has been applied, as the lower amount is what you will be paid.

I would suggest speaking to your super fund or a Centrelink Financial Services officer to confirm your personal circumstances.

Related articles:
Super and the Age Pension
Deeming rates for Age Pension

Written by Debbie McTaggart

RELATED LINKS

How super is assessed when applying for the Age Pension

Understanding whether your super is assessed as income or an asset is vital.



SPONSORED LINKS

LOADING MORE ARTICLE...