Not enough older Australians are aware of the eligibility requirements for the Age Pension, says Lifewise Financial Solutions financial planner and director Emma Arthur.
She said that older people needed to reassess their situation on a regular basis as, over time, the assets that had made them ineligible for the pension may have depleted, making them eligible for a part pension.
She also said that “you only need to receive $1 of Age Pension to be eligible for the healthcare card”, which can be worth thousands of dollars’ worth of benefits over a year.
“[It] definitely helps a lot of people fund their retirement plan, and we often find that clients receive either a full or partial Age Pension and supplement this via drawdowns from personal account-based pensions to meet ongoing living expenses”.
Ms Arthur also commented on how reliance on the Age Pension tended to increase further into retirement.
“We see a higher level of spending in the earlier retirement years where people are fit and well and have the ability to travel more widely,” she told Nest Egg.
“[This] results in a depletion of assets in the earlier years, which in later years can certainly result in an increased reliance on the Age Pension.”
She said it was important to understand the assets test and know how to maximise your entitlements.
“Seek advice, have someone review your situation, build up your retirement nest egg, make sure you have things invested in the best structures to minimise any personal tax [and] maximise any potential entitlements to the Age Pension,” she said.
Have you recently checked whether you’re eligible for the Age Pension?
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