Cash-Strapped Tribes, did you know this?

Older Australians who rent their home should know these strategies, says Centrelink expert Glenn Smith-Cameron.

Cash-Strapped Tribes, did you know this?

YourLifeChoices’ 2019 Insights Survey found that 13.2 per cent of the 6731 respondents rent their home. If you are one of this group, are you making the most of the benefits that are available to assist you financially? 

A key concern of YourLifeChoices members is that government benefits and allowances are sometimes not widely known. The following strategies are available to help age pensioners who rent – the Cash-Strapped Tribes.

Rent Assistance
The maximum fortnightly Rent Assistance payment for a single is $137.20; for a single who shares, it is $91.47, and for a couple combined, it is $129.20. The amount of Rent Assistance will depend on the fortnightly rental costs. For a single, the maximum will be paid only if the fortnightly rent is at least $302.27; for a single sharer when the rent is at least $241.91 and for a couple combined, when the rent is $366.87.

Government housing
No Rent Assistance is available for retirees in public housing, but cheaper fixed rent makes this an attractive option. However, the waiting times can be lengthy and you may have no say in where you are allocated a house.

Moving to a regional area
The rents are likely to be cheaper, but careful consideration should be given to the availability of public transport and medical facilities.

Sharing
1. Two people sharing accommodation are able to get a total of $182.94 a fortnight in Rent Assistance when paying $500 a fortnight in rent.

2. Family members who share can take advantage of a quirk in the system. Consider this example of a woman living with and paying board to her brother and his partner. All are receiving an Age Pension, but the sister is also able to claim Rent Assistance for the amount paid to her brother (assuming she is paying at least $302.27 a fortnight). The rental payment is not considered as income for the brother from a Social Security assessment.

3. People often live together for care and companionship. A student or pensioner might live with another pensioner for free or for reduced board in exchange for such duties as care, companionship and housework.

Granny flat
This involves paying for the right to live in a specific home for life.

The property must belong to someone else. It is not a description of the type of property.

It must be:

  • all or part of a private residence
  • your principal home
  • not owned by you, your partner or a trust or company you control.

The right lasts only for your lifetime and is not part of your estate when you die.

If the payment for the life interest is under the extra allowable amount (the difference in the assets threshold for a homeowner and non-homeowner) – $207,000 as at January 2019 – a person can qualify for Rent Assistance if rent is paid.

Use of a site or structure for a caravan, relocatable home or a boat
A person in a caravan, relocatable home or boat is considered a homeowner but not a non-eligible homeowner and therefore is able to claim Rent Assistance, irrespective of the value of the caravan, relocatable home or boat.

Are you eligible for an Age Pension? Do you know your rights? The PensionChecker™ tool has all the information you need.

This article first appeared in the March 2019 Retirement Affordability Index.

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    Disclaimer: All content in the Retirement Affordability Index™ is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.





    COMMENTS

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    Karl Marx
    21st Apr 2019
    11:11am
    And don't bother applying for rent assist if living overseas even though some overseas rents can be expensive.
    Cowboy Jim
    21st Apr 2019
    1:32pm
    And do not present your pension card at the Chemist either. Living overseas is not all that easy when one looks at a wider scope than cheap rice, beer and cigs. Been there and looked around and very happy living here.
    tactful
    23rd May 2019
    11:00am
    If you live overseas too damn bad. You should count yourself lucky to get a pension at all.
    ozrog
    23rd May 2019
    11:01am
    Am i mis understanding or are you saying you want rent assistance and you are living overseas and you also want cheap scripts.
    You are living in another country what are you thinking?
    jackie
    23rd May 2019
    12:14pm
    SRF, the Pension is not a work payment. Living overseas is a lifestyle choice option.
    Karl Marx
    23rd May 2019
    1:06pm
    yes ozrog you misunderstood, I was making a statement as I know there are people on here that live overseas. I travel a lot so only in Australia for 3-6 months a year.

    Jackie, a lot of the time living overseas isn't a lifestyle choice. sometimes retirees move overseas to be with family or are carers for aging parents or relatives & some just simply have had enough of living in poverty in Australia for whatever reason.

    tactful, up yours mate, I'm self funded & those that do receive a pension & decide to expat overseas are just as entitled to their base pension as anyone else, same as we have expats from other countries living in Australia with overseas pensions.
    Diogenes
    23rd May 2019
    2:24pm
    Hi Cowboy Jim,

    Are you referring to a particular or area (i.e.SE Asia), I have only ever lived overseas in USA , (didn't like it people are a disposable commodity there), England, France and NZ, all very affordable, but I just love living in Australia. Despite all our recent political bantering, discussion, and arguing, Australia ( no matter what party is in power ) still ticks all my boxes of desirability.
    Cowboy Jim
    23rd May 2019
    7:30pm
    Yes Digby - I am referring to Asia mostly because that is where the Aussie pension might be enough to live on. I quite often go to Europe, my family lives there but I could not afford to live there unless I would get free rent. Food and drink is possibly cheaper than here but accommodation and health insurance is above my assets. NZ is no longer that affordable either, have a look at their GST at 15% on all items, and the $ difference is now no longer an issue.
    I do like living in Hawaii from time to time but all their taxes put me off. If you can afford to stay there for 6 months in a rental then the holiday taxes fall away as you are considered a resident not a tourist (way to go if you can do it, away from Waikiki Beach rentals are affordable and going to Walmart for shopping). Think of international health insurance though for the time you are away, a trip to the hospital is $thousands for a couple of days. If I was younger . . . that would be different.
    Charlie
    21st Apr 2019
    11:21am
    There is no such thing as waiting time for government housing. If you are not financial enough to pay out the remainder of your current lease when the housing becomes available, you simply don't get it, no matter how long you have been on the waiting list.

    Also singles are disadvantaged because the housing authority (North Queensland) will not rent a two bedroom flat to a single person regardless of price. Government units for singles are hard to come by.

    The housing usually goes to people who are boarding somewhere and have never held a lease. The way the system draws in desperadoes, hardly makes this housing a good option in regard to providing a safe environment for an age pensioner.
    musicveg
    21st Apr 2019
    3:32pm
    The whole government housing system is wrong, with so many people still living in them even after they have got good paying work, getting rid of those people would free up more Government housing. I gave up being on the list because I know I would be given a house too far away from my elderly mum or put in the only ones available around here which is tiny flats full of druggo's or mentally challenged people, my brother lived in one for awhile and told me all about how horrible it is, and basically unsafe, so no choice but to keep paying high rent which rises every year.
    jackie
    23rd May 2019
    12:37pm
    Charlie, they do have public housing for age pensioners. Of course it won’t be two bedrooms but one bedroom is sufficient for an individual any way.

    Unfortunately, many in public housing are the mentally ill because institutions for them no longer exist.

    Normal poor tenants have to put up with them and drug addicts usually in sub standard living quarters.
    KSS
    23rd May 2019
    1:05pm
    There is also the issue of an original recipient of government housing 'bequeathing' their residence to an adult child as if they actually owned it whether the adult child actually qualifies for it or not.

    Then there are those who were originally granted housing on the basis of having a family. That family has grown up and left but the original tenant will not give up the property even though the three bedrooms (or whatever) are no longer necessary for them alone. This deprives another family of that property.

    Both these issues should be far more tightly controled to ensure those that really need government assistance get it. And by the way this is a State and local council responsibility, not the Federal Government of any hue.
    Diogenes
    23rd May 2019
    2:38pm
    Dear Jackie,

    Now don't faint but I totally agree with you not this point. And may God forgive me I was one of those who was forced, and used as an instrument to help closedown two of those large institutions (Larundel and Willsmere). Yes it was under a Labor state government but that is irrelevant here, I am not satisfied the other side would have been any different. Now I see so many of those poor individuals on the street homeless, clearly very mentally unwell, who would have been so well served by those institutions, kept well housed feed, safe, and well attended medically. And I agree it is a great shame, sad and tragic to see so many of them taking up public housing where they are not getting the medical help and support they need, and perhaps depriving others of public housing. A bipartisan committee to address this may be helpful. The spinal article that forced the closure of such institutions in the western world was buy Ayollin and Azrin in institutionalisation, that came out in the late 60's. There will always be a core element or group of of people who will benefit from, and indeed deserve the services of those large institutions . In this aspect governments of all colours got it wrong.
    Take care,
    Digby
    Diogenes
    23rd May 2019
    2:39pm
    NB :spinal should read seminal
    musicveg
    21st Apr 2019
    3:34pm
    Did not know about the Granny flat thing which is interesting. We do need more low rent accommodation available but how is it going to happen in regional areas where we are paying not much less than city prices, not all regional areas are that much cheaper and if you take into consideration costs of travel to services or to see family you are not much better off.
    older&wiser
    23rd May 2019
    3:38pm
    Agree musicveg - country places are not always cheaper. I own a house in a suburb of Brisbane. Land value $365,000. My sister owns a property in a western Qld town more than 600kms from Brisbane - land value $62,000. Yet her rates are considerably dearer than mine. Rental prices in her town are on par with rents around my place.
    Cowboy Jim
    23rd May 2019
    7:46pm
    Quite right in2sunset. The only saving you make is by buying a place in the bush, the levies are the same, fewer people but all services required. I would not recommend going bush in older life as the medical services are just not there. We had a retirement house paid for in a northern area, a brush with cancer put an end to the idea. Good idea when you are younger but do not consider it when old.
    Missskinnylegs
    21st Apr 2019
    4:29pm
    I'm 71 and work 4 days a week by choice (not ready to go regional or rural NSW just yet!) even on a low hourly rate I've had my OZ pension cut completely (not available for housing list either) and my rental assistance suddenly dropped $15 a fortnight and seems to be dropping every fortnight! I get no response from Centrelink - they said ages ago it was because my part NZ pension of approx $50 a week had risen - when in fact it had gone down by $40 a month. I still pay taxes - feel something is dreadfully wrong here but no-one in the Centrelink aged section has a clue? Annoyed and stressed about it all.
    musicveg
    21st Apr 2019
    5:19pm
    Get on the phone because often you can get someone who is more knowledgeable than in the office. And go to see your local MP too.
    Cowboy Jim
    21st Apr 2019
    5:35pm
    Join us in regional NSW, not a bad life. The cost of units is still reasonable although rents have risen as not too many people want to build accommodation units around the place. A few units are available for under $300'000 but rentals are $420 and up. Maybe you work too many hours - throttle back!
    jackie
    23rd May 2019
    12:42pm
    Missskinnylegs, contact NZ to email you documents with proof about your income then provide them to Centrelink by email. That can be your proof of contact if no results occur and use it to raise a complaint to a higher level.
    older&wiser
    23rd May 2019
    3:48pm
    Missskinnylegs - know exactly what you mean. I was on part pension, working casual job. The nightmare of Centrelink constantly getting my payments wrong, taking weeks to sort it out, of me always having to tell them how to do the calculations. The stress and time wasting was a nightmare. In the end, they won - I chucked in the job. My accountant is still adamant I have been grossly underpaid, but the fear of getting a Robo debt in years to come - with no explanation or breakdown - was the final straw. Luckily I only live 1.5kms from my local CL office, and I was often in their office on a daily basis. You can speak to them till you are blue in the face, and I can understand how people get so frustrated with them.
    McDaddy
    23rd May 2019
    3:57pm
    If NZ pays you say $200/mth then if your Centrelink payment after you tell them your earnings,is going to pay yu less than that, then your OZ Pension won't pay you anything, but you should still keep the Pension Concession Card etc.
    Triss
    24th Jun 2019
    12:17pm
    It makes me mad enough to burst a blood vessel, Missskinnylegs, when pollies cut pension payments if you work but allow full pensions to ex pollies, bureaucrats and ex public servants when they have jobs and/or run their own businesses.
    KB
    23rd May 2019
    12:59pm
    You need t have a certain income threshold to be eligible to apply for public housing. In SA you can nominate where you want to live but the waiting list is very long.
    KSS
    23rd May 2019
    1:08pm
    In NSW you can accept or reject any housing offered to you - and people do, including the homeless street people! This will mean that there will be a longer wait until something suitable becomes available in your preferred area.
    older&wiser
    23rd May 2019
    3:51pm
    KSS - yeah - they are all waiting to be offered a place in Bondi, so turn places down till they get offered what they want.
    Cowboy Jim
    23rd May 2019
    7:37pm
    yes in2sunset - only Bondi or Waikiki will do, maybe Manly with a view to water might be considered - champagne tastes and a tea budget, eh?
    Should put our kids on the waiting list right now, they would appreciate it!
    KB
    23rd May 2019
    12:59pm
    You need t have a certain income threshold to be eligible to apply for public housing. In SA you can nominate where you want to live but the waiting list is very long.
    Old Fella
    23rd May 2019
    4:59pm
    There is some talk of an equitable/living wage for employees on current minimum wages or casual wages, but continuing political action for reducing costs of pension and pensioners to the Government. Also, there appears to be a deliberate intention to force self-funded retirees and superannuated ex-workers to divest themselves of shares and taxable share dividends, specifically franking benefit and to downsize and sell their home property to lower home prices for those currently underpaid and unable to buy a home. At the same time helping self-funded and superannuated retirees to maintain an equitable/living income without the need for Government input or obligation. With full-time employment in decline, GDP in decline and Inflation baying at everyone's heels, Retiree Assets sold off and expended, the only people in Australia capable of enjoying the 'Lucky Country' life will be Politicians, Overpaid, underemployed with over provided retirement income. Guess what! Ultimately the Government Income is also doomed like the underemployed, sick and retired and Politicians then will have only Dictatorship or reversion to Feudal society to keep them in the manner they have become used to. In the autumn of my life, I am proud to have worked full time on fair wages and raised a family in their own house and sustained well enough to reach adulthood. Today's regret, however. I seriously doubt my Grandchildren will ever know what was the lucky country.
    Old Fella
    23rd May 2019
    4:59pm
    There is some talk of an equitable/living wage for employees on current minimum wages or casual wages, but continuing political action for reducing costs of pension and pensioners to the Government. Also, there appears to be a deliberate intention to force self-funded retirees and superannuated ex-workers to divest themselves of shares and taxable share dividends, specifically franking benefit and to downsize and sell their home property to lower home prices for those currently underpaid and unable to buy a home. At the same time helping self-funded and superannuated retirees to maintain an equitable/living income without the need for Government input or obligation. With full-time employment in decline, GDP in decline and Inflation baying at everyone's heels, Retiree Assets sold off and expended, the only people in Australia capable of enjoying the 'Lucky Country' life will be Politicians, Overpaid, underemployed with over provided retirement income. Guess what! Ultimately the Government Income is also doomed like the underemployed, sick and retired and Politicians then will have only Dictatorship or reversion to Feudal society to keep them in the manner they have become used to. In the autumn of my life, I am proud to have worked full time on fair wages and raised a family in their own house and sustained well enough to reach adulthood. Today's regret, however. I seriously doubt my Grandchildren will ever know what was the lucky country.
    Hoohoo
    27th May 2019
    11:56am
    I am curious about the statement in point #2: "Family members who share can take advantage of a quirk in the system. Consider this example of a woman living with and paying board to her brother and his partner. All are receiving an Age Pension, but the sister is also able to claim Rent Assistance for the amount paid to her brother (assuming she is paying at least $302.27 a fortnight). The rental payment is not considered as income for the brother from a Social Security assessment."

    That last sentence "The rental payment is not considered as income for the brother from a Social Security assessment." Surely rent money paid to the brother is considered as income? Are you saying, Glenn Smith-Cameron, that this money DOESN'T affect the brother's amount of pension?


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