Big win for 50,000 retirees
In a surprise announcement last week, Prime Minister Scott Morrison shared an expansion of the Commonwealth Seniors Health Card (CSHC) for 50,000 self-funded retirees over the next four years.
This will be done by increasing eligibility for both singles and couples.
The current income threshold for singles, $57,761, will be increased to $90,000, while the current couple’s threshold of $92,416 will be lifted to $144,000.
The start date for the new eligibility rules is July 1 this year. The scheme is predicted to cost $70 million over a period of four years.
Within 24 hours, the Labor Party had pledged to match this policy, with Opposition Labor spokesperson, Jason Clare, declaring it a ‘good idea’.
So regardless of which major party wins the May 21 election, these changes will start on July 1 this year, and deliver significant cost-of-living savings for those who are not on a full or part Age Pension.
In essence, the CSHC was created to help those in retirement, but not on a pension, to save on health care and prescription medicines. We recently shared an article outlining how one couple had saved $800 in a matter of weeks after receiving their CSHC. Whilst many consider self-funded retirees to be ‘well off’, a high proportion have seen their savings dwindle as prolonged low interest rates mean returns on cash investments have been extremely poor. So whilst those on the Age Pension have at least benefited from regular cost-of-living indexed increases, those who fund themselves have not had a ‘wage rise’ for the last few years. The increase to the CSHC thresholds is one of the most significant changes for retirees in quite some time and will be welcome news to those facing high medical or pharmaceutical bills.
The interesting fact about this card, however, is that whilst nearly two million Australian retirees might be eligible, fewer than half a million have applied. If you think you may be in the running to now get a card, watch for an update from Retirement Essentials at the end of June, when our entitlements calculator will be changed to reflect the new thresholds. And if you want help to apply quickly and easily, we would be delighted to assist you with this very handy concession card.
I live with my wife and 14 year old daughter I am retired my wife is working,I get family tax benefits and hold a comonwethe card but that won’t put food on the table I have tried for a part pension but it’s hard for the application as I have a few dollars in the bank but not earning me anything my daughter needs this money for when she go’s to university I hope one day life is just a struggle so don’t look forward to retirement
I am on part pension since July 2020 , my wife will reach her age pension in October this year but still having full time job , Last month we sold our residential house with a settlement date end of June and of course after cashing big money from the sale that will let me lose my part pension although we are looking to buy another house but smaller and we might be forced to rent a house till finding suitable one , please what your advice or type of help in this situation.
Hi Hani, thanks for reaching out! Regarding the proceeds from the sale of your house getting your pension cancelled this should not happen. If you explain the situation to Centrelink they will apply an exemption of 12 months on the funds to give you the time to buy/build a new house. As you are looking to downsize the net result will likely be an increase in your assets once you have bought again but it may not be so high that your pension is cancelled.
Given that you may have additional funds at your disposal after you downsize, you may be interested in booking a Retirement Advice Consultation with us. Our financial planner can help you better understand your needs and goals post-purchase and some of the actions you can consider to help you achieve those goals. The consultation can be either online or via phone call, goes for up to 45 minutes and costs $150.
CLICK HERE to book now.
Hi Steven,
thank you for your professional advice and defiantly I will need to book consultation with you and discuss some other issues like our superannuation and the new rules of deeming system which will apply from july 2022
Would you please email me your contact number to have a little chat before I do consultation booking at least I will have better understanding to your services
Thanks
Hi Hani, thanks for coming back to me! One of my colleagues from our advice team will email you to confirm your contact details so they can call you to discuss the service and how they believe they can help you.
I am working aged 68 earning 112K gross, my wife is retired
We do not get any Centrelink benefits or pension
With the expansion of the Commonwealth Seniors Health Card
Will I be able to get this card
Hi Frank, great question! If the proposed increase to the allowable income for the Commonwealth Seniors Health Card goes ahead as it has currently been proposed then yes you will become eligible.
Iam 67 pension age but only gets a senior health care card .because my wife works fulltime earning $90000 per year. Will I be entiitled to get a part pension after July
Hi Terry, thanks for reaching out! Based on the current proposal yes you will become eligible.
I am 69 years of age and retired. My husband is working full time and earns $110k per year. Does this mean that I could obtain a Health Care Card or part pension on 1 July 2022. One or the other.
Hi Jan, thanks for reaching out! The proposed changes are only applicable to the Commonwealth Seniors Health Card, not the Age Pension.
Good morning Steven
I am 62 years of age and have not been able to return to work after I was involved in a car accident in May 2019. After having to wait almost 2 yrs I am now receiving income protection from my superannuation until 2025
My husband income is approximately $92,000 pa
I will not be able to return to work, but my medical costs are high. Would I be eligible for a heath card and early retirement.
Hi Denise, thanks for seeking help! In your situation, even with the proposed increase to the income threshold, you will still be too young to apply for a Commonwealth Seniors Health Card (CSHC) until you turn 67. There are no exceptions to the age criteria for the CSHC and/or Age Pension, you must be of age before you can apply.
Given your circumstances though, our financial adviser may be able to assist you with some of the actions you can consider to help you make the most of your finances between now and when you become age eligible for either the CSHC or Age Pension. Our Retirement Advice consultations can be either online or via phone call, go for up to 45 minutes and cost $150.
If this is of interest to you please CLICK HERE to book now.
What documentation do I need to supply to get an application under way?
Hi Gordon, great question! We will send you an email separate to this comment with a checklist of documents to have on hand. As you have commented in response to our CSHC article that is the checklist we will provide however if you actually wish to apply for the Age Pension please reply to the email to let us know and we can send you an Age Pension checklist instead.
Hi, have noted in this and previous discussions that it has been proposed to change the current income threshold for singles, $57,761 to $90,000, while the current couple’s threshold of $92,416 will be lifted to $144,000. Was this just another ploy by the Govt and Opposition to buy votes. Or will is happens!
Hi Michael, this is the $144,000 question on everyone’s lips at the moment! For the proposed increases to go through they need to pass legislation. This process has begun but it is not through yet. Currently it is being advised as coming into effect on 20th September presuming it passes legislation. We’ll be keeping our eyes open and ears to the ground so that we can keep our members informed of any updates as soon as they happen.
Hello. A few years ago the Abbott conservative government, without warning, jacked up asset limits for age pension eligibility. This effectively and immediately threw thousands of full or part-pension recipients off the age pension altogether. As a cynical token of good faith however, they were permitted to retain only their valuable pensioner concession cards. At that precise time my wife and I (then both in our late sixties), were proposing imminent retirement (years in the planning) on the basis of the age pension entitlements prior to this drastic change. Based on our assets at the time we would have been entitled to at least a part pension. After that government change, all we could manage to get was a Commonwealth Seniors Health Card which offers nowhere near the extensive range of concessions available to pension concession cardholders. We are at present fully self-funded retirees because our combined assets exceed the limits to be eligible for even a part-pension. However, in the volatile global financial markets climate, we along with most superannuants have seen significant balance falls in the recent past. It is an unnerving feeling and tends to make one feel very insecure about the future. As we age further, will we see a return to pre-pandemic super fund performance in time to benefit from it? It is ironic that we have been savvy to a fault and avoided the pension safety net, but cannot receive from Centrelink a recognition of this by way of a concession entitlement that matches the former pension recipients arising from those 2017 changes to assets limits. In light of the emerging generous increases in income limits for pensioners and eligibility for the CSHC, has the new federal government recognised retirees in our unique position and proposed some equitable recompense? At the moment we do not feel much incentive to stay off the age pension system.
Lance Pedersen 81 Orchid Street Enoggera 4051. Since the first of July I have been to Centerlink and told I wasn’t eligible for the Health care Card because my partner was earning too much (about $100,000
and the 144,000 hadn’t come in yet. It gets very confusing.