What you need to know
As we head into a new year, there’s that wonderful sense of optimism and opportunity. This often means the chance to do things differently, to make the changes we believe might make our lives better, in whatever way matters most.
At Retirement Essentials we believe that our role is to ensure all our members are fully informed about the rules and options of retirement income. And that you know of any changes well in advance. Today we are concentrating on Age Pension updates – what might happen in 2025 and how you can anticipate any ways in which these changes might affect your own situation.
Age Pension increases 2025
The basic rate of the Age Pension is scheduled for review twice a year. Changes go live on March 20 and September 20 every year. This indexation is based upon changes to the Consumer Price Index, Pensioner Beneficiary Living Cost Index and the Male Total Average Weekly Earnings. By end February the data necessary to calculate a March indexation increase has usually been released. This means we are able to send a newsletter with projected changes in late February (or August), a confirmation of changes by March 15 (or September 15) and notice that our Age Pension Entitlement Calculator has been updated by March 20 (or September 20).
Income and Asset Test limits 2025
The limits for both parts of the means test are often changed on the same dates as indexation (March 20 and September 20). Additionally both limits can change again on 1 July. We inform our members by enewsletter of all such changes. It’s really important to keep your eye on these limits if you are ‘almost’ eligible. You can use the free Age Pension Entitlement Calculator at any time to ensure you are able to apply as soon as possible, thus mitigating the danger of a loss of potential benefits while your application is being processed.
Deeming Rates changes 2025
Because of the general economic uncertainty caused by the Covid pandemic, successive Federal Governments have chosen to keep deeming rates frozen, thus giving retirees a degree of security as to their income assessments for the Age Pension or the Commonwealth Seniors Health Card (CSHC). The current rates can be seen here. These rates are due for reassessment by 1 July 2025 and it is highly likely they will be increased for the first time in five years. What does this mean? A higher deeming rate will mean that you will be deemed to earn higher income than you currently do and if on a full or part-Age Pension, your entitlements may reduce. Again, you can use the Age Pension Entitlements Calculator completely free of charge to check any changes to your entitlements should deeming rates be adjusted.
How do you keep on top of these changes?
The team at Retirement Essentials works hard to ensue all our information is as up-to-date as possible. We have prepared a comprehensive overview of all Age Pension rules so you can refer to that as often as you like, secure in the knowledge that it covers all relevant government changes as soon as they become law. The following aspects of the Age Pension covered in this overview:
- How the Age Pension is calculated
- The income thresholds – How much you can earn before your pension is affected
- The asset thresholds
- The current Age Pension rates
- When Age Pension rates change each year
- When the asset and income thresholds change each year
- Other changes that could occur in 2025 that could affect the Age Pension.
We trust that this brief overview of what’s ahead for government entitlements has been helpful, but please let us know if you have any further questions we can answer on changes to retirement income in 2025.
If you are already receiving Age Pension benefits, but are curious to know if they could be higher, it’s well worth considering a Maximising your entitlements consultation. In this guided consultation, Retirement Essentials advisers can show you how to make the most of your financial resources and how they combine with Centrelink.
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