It’s estimated that many retirees who have delayed applying for the Age Pension are missing out on an average total amount of $69,000. We highlighted how this had happened to Geoff in August. The reason that he had missed out was that he was initially a self funded retiree and thought he wouldn’t be eligible for the Age Pension for several years. He didn’t really know the rules and was caught out to the tune of $75,000 over a three-year period when he was actually eligible.
Not knowing the rules is probably the main reason that retirees miss out on this valuable income. But there are plenty more. Here’s a shortlist of five shared by our advisers and Customer Service Team for you to check, to ensure that you’re not missing out needlessly as well.
But I’m still working
.. and so can’t qualify. That’s not entirely true. At some stage you will stop work. It may be soon. If you have already reached Age Pension age (66-67 depending upon when you were born), then you can apply before you actually stop. When it comes to the declaration of income, you are able to insert your full work income and this will be used in the income calculation to determine if it is below the income limit. Or if within the next two weeks you will be stopping or reducing work hours (and thus earning less income) then you can declare this expected lower amount.
This means that the income you will be receiving by the time the application is being processed – i.e. after you have stopped work. So factoring in your current full work income is not necessary – as long as you are honest and declare your expected work income from your expected retirement date. And if you are stopping work in a few weeks you can get your application in now and update Centrelink as soon as your arrangements change.
I don’t believe I’ll qualify
Many, many of our customers are very surprised to learn of their entitlements. Like Geoff, they have just assumed that they either earn or own too much. But the Age Pension income and assets test is far from static. It changes regularly, usually every six months. There has also been an expansion of the Work Bonus allowance and changes to deeming rates over time. It really does pay to recheck your eligibility frequently. You can do this for free using the Retirement Essentials Age Pension Eligibility Calculator. This calculator also helps determine if you miss out on a pension, then whether, as is likely, you will qualify instead for a Commonwealth Seniors Health Card.
I am restricted by the Pension Bonus Scheme
Many of our members won’t have heard of this scheme. Some will. It is no longer relevant to most retirees as it has been closed to new entrants for many years. It was an incentive introduced in 1998 to keep working longer, with the delay in your eventual Age Pension being rewarded by a lump sum payment. Whilst a few retirees are still delaying retirement in order to maximise this benefit, unless you qualified and were accepted into the scheme before it closed to new registrations in 2014, it is irrelevant to your application timing. So maybe it’s time to jump on to it and get your Age Pension application in.
I’m waiting until I’ve finished the renovations
Or the cruise. You may wonder what this would have to do with an Age Pension application, but it’s a very real motivation for many people. The reason is that, knowing they will spend a significant amount of money, they believe this will then reduce assets and so they will qualify for an even bigger fortnightly payment. It’s true up to a point. Lower assets can result in higher Age Pension payments. But if you qualify now, then delaying your application is pointless. You can apply, start enjoying regular Age Pension payments, however small, as well as the discounts and benefits associated with your Pension Concession Card. Then when you have paid for those renovations or that cruise, you can immediately report this change in assets and have the adjustment to your pension payment made. Waiting until you have spent this money is not helpful and just means you earn less in the meantime.
I’m waiting until my partner is ready
Thinking you need to apply as a couple is correct. But thinking that both of you have to be ready to receive an Age Pension is incorrect. When you apply Centrelink will assess you as a ‘couple’ or ‘household’ which means both parties assets are relevant. But as we’ve reported many times, those with younger partners who are still working and whose super is still in accumulation mode can often easily qualify as their partner’s super is not assessed by Centrelink. If you are Age Pension age and you believe you may be eligible, simply check this out using our free Age Pension Entitlements Calculator. Delaying your eligibility check may be costing you money.
We speak with many retirees who think, for one reason or another, they just wouldn’t qualify. It’s great to be wrong and be rewarded with income. But it’s far better that this happens sooner rather than later, don’t you think?
If you would like support to apply for your Age Pension, you can book an Age Pension Consultation meeting to help you better understand all the rules. Our advisers can also help identify changes you might be able to make to maximise your entitlements.
What’s your story?
Have you applied and found out you could have been receiving benefits a lot earlier? If so, what do you believe contributed to this delay?
Agree get in early as my partner applied for his 6months ago and still has not received the pension he is entitled to. While back payment will occur it still puts a strain on the budget.
I am 70, retired in June and now work casually at my place of prior employment. how do I estimate my income when I only work from time to time
Hi Edna, thanks for reaching out! It can be tricky when you are only working on an ad hoc basis however you don’t need to estimate if you are working for an employer, you simply declare to Centrelink what income you received in line with your pay slip. The amount may vary from one fortnight to the next but that is why Centrelink ask for continuous reporting so they can calculate each fortnight’s pension payment as accurately as possible.
Hi I have been using the work bonus scheme for some time returning to nursing as casual and doing 20+ hrs a fortnight report each fortnight and have not had a problem it was very important to do your research properly it is a good scheme but unfortunately it will change next year I hope new legislation to extend it will happen as they will reduce it by $4k to $7,800pa here’s hoping but I can recommend it good luck
The Lower Income Health Care is also worth applying for if you don’t qualify for any pension. For the most part, this has far more benefits than the CSHCC.
Does going overseas regularly go against claiming my pension I am working on mine site 2n2 and I am eligible for pension 67 now just checking thinking of stopping working
Hi Kevin, thanks for asking a great question! The main issue to be mindful of is that you do need to be in Australia on the day you lodge your claim. Other then that though it sounds like you are ‘living’ in Australia and only travel abroad for work so you would not be considered a resident/living in another country and there is not likely to be any major complications with your claim.
due to serious ongoing illness my younger husband has not been working for four years despite him hoping to get back to it when he recovers one day. His super assets are in accumulation phase of super. Will this, his super asset, be counted even though I am the only one eligible to apply for the aged pension in 2024? He can access his super in lump sums to spend on his necessities and it then does not sit in the bank or elsewhere, so his accumulated super does go down in value. I have read that only if a younger spouse is working and has inaccessible accumulation phase super does the asset not get counted towards your pension application? Can you please clarify this?
Hi Jan, I’m sorry to hear of your husband’s illness but thank you for reaching out to us. Whilst your husband is under Age Pension age and his super is in accumulation it remains exempt, whether he is actively employed or not. Once he either turns of age or if he transfer the account into an Account Based Pension then it will become assessable but for the moment it is exempt.
My wife is the current trustee of our beachhouse . If we were to nominate our children as trustees, would we then be eligle for the pension
Hi Michael, thanks for your question. It depends how the transition happens. If your wife is entitled to an asset then Centrelink will expect that she is fairly compensated if she were to give up part of or all of her right to that asset. Simply adding your children on and effectively handing the beach house over to them will likely be considered as a gift because your wife received nothing in exchange for giving up her right to the asset. She could ‘sell’ it to the children so that she receives something in return however the money received would be assessable the same as the beach house is so may still leave you/her exceeding the threshold.
My friend did this (gifted a house to her Son). Centrelink advised her that 5 years had to pass before that asset was no longer relevant to ‘her’ asset poole. She had gifted 1/2 the house to him initially for 2 years and then decided to gift the complete house which required another 2 years to pass; but she waited 3 years before she applied for her Centrelink. They advised her that the house was now deemed her Son’s and no longer considered her asset, acknowledging it was gifted to her son.
Can you go into Centrelink and see a financial advisor? I will be 67 in October 2024 but doubt whether we are entitled to anything even though I don’t work as hubby is 62 and works occasionally but earns $57,000 per annum through a Trust setup. I thought maybe we could get a Commonwealth Health care card possibly at least? It doesn’t seem fair to get nothing after a lifetime of work and paying taxes. I have done the eligibility test online and we don’t qualify for anything.