Which pension is better?

After a visit to the vehicle-licensing office, Joe is unsure whether he would be better off remaining on the Disability Support Pension (DSP) or switching to the Age Pension.

Q. Joe

While paying my vehicle licence recently, the person behind the counter asked why I’m not on an Age Pension instead of the Disability Support Pension (I’m 66 soon).

She went on to say that as an aged pensioner, I would be entitled to a free driver licence when it’s due to be renewed.

Can you tell me which pension would be more beneficial for me?

The pension that is best suited to you really depends on your individual circumstances and is something that you should consider carefully. When you reached Age Pension age, Centrelink should have written to you asking if you wish to transfer to the Age Pension and outlining the differences between both payments.

Essentially, the payment rates are the same for both the Age Pension and the Disability Support Pension. As you receive a Pensioner Concession Card with both payments, I’m not sure as to why you would be eligible for a free driver’s licence as an Age Pension recipient and not a Disability Support Pension recipient. However, it is worth noting that concessions offered differ between states and territories, so you will need to check which concessions are paid in the state in which you reside.

Many people choose to switch to the Age Pension when they reach pension age, as it means they no longer need to have their eligibility for the DSP assessed. However, depending on your individual circumstances, you may receive additional payments due to receiving the DSP that you would not receive under the Age Pension.

It can also be more beneficial to be on an Age Pension if you plan to travel for extended periods overseas.

As this information is only general in nature, you should contact Centrelink to discuss your individual circumstances to enable you to ascertain which payment is best for you.

Related articles:
Which concession card am I eligible for?
Claiming your Age Pension overseas

Written by Debbie McTaggart