How Tom turned $6 into thousands
The team at Retirement Essentials doesn’t believe in ‘get rich quick’ schemes. We’re more impressed by slow and steady wealth creation.
But we do recognise the significant financial gains there are to be made by those who understand Centrelink rules. And use these rules to maximise their entitlements.
Take the case of Tom, for example.
He’s a single homeowner with total assessable assets of $594,000. This means he exceeds his maximum threshold of $593,000 and this makes him ineligible to receive the Age Pension.
Among his assessable assets is a 1990 Toyota Corolla that he has valued at $4,000. This is a bit high and it is likely he would only get about $1,000 if forced to sell his car. If instead, he valued his car at the more accurate amount of $1,000 he would be eligible to receive a very small part Age Pension. He would only get $6 a fortnight, or $156 a year.
Not a lot on the face of it.
BUT, Tom would also receive the pension supplement of $38.30 a fortnight and the energy supplement of $14.10 a fortnight. As well as be entitled to the Pension Concession Card. So in total he has missed out on $52.40 a fortnight, or $995.80 a year on supplements alone, just by overvaluing his much loved, but not very valuable, 1990 Corolla.
The extra value attached to a Pension Concessions Card is hard to define, as it will vary from individual to individual, but it does offer discounts on:
- cheaper medicine,
- bulk billed GP visits,
- bigger refunds for medical costs and help with
- hearing services.
In addition to individual State and Territory offers a range of discounts on services including public transport, rates and utilities. These discounts and refunds will save Tom a further two to three thousand dollars a year.
In summary, the simple revaluation of Tom’s car has led to his eligibility for a part pension of $156, plus nearly $1,000 in supplements, plus the PCC, conservatively worth an extra $2000 per year as well. $3,000+ extra income every year has given Tom some much needed financial security.
So why not check what your entitlements might be and remember .. don’t overvalue your personal assets.
You can find our free calculator here.
Great Information.
Interesting example the one of the car! So, as cars loose value in time, does Centrelink adjust the value automatically or do we need to ask to reassess? If so, how can we do it please?
Hi, my wife was born in september 1961 and I was born in september1956. We are holding a cash of $400,000.
If we give $250,000 to our son as a gift. Will it affect my future age pension amount?
Regards
Richard
One of the biggest savings for Tom is registration and third party insurance. It is half the normal rate for a vehicle. Currently this is a saving of $ 395.5 off a bill of 791.
if assets being minimal
How much is the single mans pension not employed and 70 years old
Hi Stephen, that maximum Age Pension a single person can receive is $1,096/fortnight which is $28,514/year.