The Age Pension rules certainly are complicated, but at the heart of things, it comes down to just two tests: the Assets Test and the Income Test.
If your assessable assets or income go over certain government limits (the thresholds), your pension payment will be reduced or it could be paused or even cancelled.
Here’s the catch: These limits and the financial picture Centrelink sees can change over the course of your retirement years. Not only do the Age Pension income and asset thresholds change periodically, but Centrelink only has a partial view of your finances. Whilst superannuation balances and most income stream products are updated automatically twice a year by your provider. Centrelink won’t know about other changes unless you tell them. You must report significant changes (such as selling shares or withdrawing a large lump sum from your super) to your assets and income within 14 days. For those close to the limits, keeping an eye on these thresholds can help you obtain or keep your entitlements.
How your financial picture can change
What about a couple who don’t qualify today?
Things can change quite quickly as Aisha and Omar discovered.
Early retirement: Rich in super, but missing out
Meet Aisha and Omar, both 67, and ready to retire. They own their home and have a healthy combined super balance of $1,300,000.
- The reality check: Since the upper asset limit for the Age Pension as a homeowner couple is currently $1,074,000, their super puts them well above the cut-off. Thus they are self-funded retirees who don’t qualify for the Age Pension.
As self funded retirees, Aisha and Omar are starting retirement in a strong financial position. However their independent mindset may mean they’ve never explored government support. And they wouldn’t be alone – more than a million Australian retirees could be eligible for the Commonwealth Seniors Health Card (CSHC) but haven’t applied.
Unlike the Age Pension the CSHC has no Assets Test. The income thresholds for the CSHC increased significantly to $101,105 for a single person and $161,768 for a couple effective from 20 September 2025.
It is estimated that the vast majority of self-funded retirees will be eligible for this highly valuable concession card. And whilst you must have reached Age Pension age (67), you do not have to be retired!
Key benefits of the CSHC:
- Cheaper medicines: Access to lower-cost medicines through the Pharmaceutical Benefits Scheme (PBS).
- Bulk-billed doctor visits: Easier access to doctors who bulk-bill, saving you money on consultations (although this is up to the individual doctor).
- Medicare safety net: Higher Medicare benefits for out-of-hospital medical services once you reach the safety net threshold.
CSHC benefits vary widely between individual states and territories.
For a detailed breakdown of state and territory concessions available with the CSHC, this article is very helpful Concession Card Benefits: How to unlock savings.
Five years on: The Age Pension door opens
Fast-forward five years to around 2030. Aisha and Omar have moved their super into an Account-Based Pension (ABP) and have been drawing down a regular income from their funds.
- If they were spending $85,000 a year on living costs, this draw-down would significantly reduce their super balance.
- This reduction could bring their total assets below the upper threshold, making them eligible for a part-Age Pension.
Even a small Age Pension payment is a win, as it automatically grants you the Pension Concession Card (PCC), which includes valuable national and state-based discounts, even more so than the CSHC
| National concessions | State & territory concessions |
| Reduced-cost medicines | Discounts on property rates and water charges |
| Higher Medicare Safety Net | Savings on electricity and other energy bills |
| Access to bulk-billed GP appointments | Cheaper fares on public transport |
| National Diabetes Services | Reduced motor vehicle registration fees |
| Hearing Services | Cheaper admission to entertainment/sporting venues |
Determining your Age Pension and CSHC eligibility is an ongoing process. But it’s well worthwhile, considering 80% of Australians are eligible to receive this government payment when they reach their 80s.. Your personal situation is unique, and a regular review of your financial position is the best way to secure your entitlements as soon as you can.
Need personalised guidance?
Retirement Essentials offers Retirement Advice Consultations to help you understand your Age Pension eligibility and overall retirement plan.
- If you are unsure where to start, why not book a FREE 10-minute phone conversation to determine which of our services best suits your needs.
- Retirement Advice Consultation
- Age Pension Consultation
Financial peace of mind is paramount. Which one question about your own eligibility would give you the most clarity today?
