The new financial year starts in a few days, so what’s going to change for pensioners and retirees?
The cost of living has us all looking at how to make cuts, but don’t take your eye off the ball on your entitlements in the meantime.
On 1 July, Centrelink updates several thresholds and limits for part pensioners. These changes do not apply to full age pensioners.
If this affects you, now is a good time to reassess and revalue your assets and income. A drop in either could mean you are eligible for more payments.
Even if you do not qualify for a full Age Pension, qualifying for even a small part payment may unlock some benefits such as pension concession cards.
Financial health check
The end of the financial year may also be a good time to do a health check on your superannuation. Are you paying too much in fees? What are the returns, and how do they compare? Why not start here.
While you are delving into your super’s performance, it’s also a good idea to consider transferring some savings you have to your super.
There are tax advantages and the returns are almost always better than bank interest.
New rules mean that if you are aged between 66 and 74 and not working you may be able to top up your super.
And don’t forget the downsizer scheme. It could mean you live in a more manageable home and add hundreds of thousands to your super.
Unless you have gone off the grid, you have also probably been hit with a hefty price rise on your energy bill.
Age pensioners should have their Pensioner Concession Card details registered with their energy provider to claim a rebate. Each state provides different rebates, but once you have registered it will carry over every year. Victoria will also send you $250 just for completing a comparison search.
If you are a self-funded retiree with a Commonwealth Seniors Health Card you have to reapply each year for the rebate.
Shop around
And if you don’t qualify for a concession card, you should stop paying a ‘loyalty tax’ to your regular power provider. Shop around for a better price using a comparison site.
Don’t just limit chasing a better deal to your utility provider. There are comparison sites for healthcare, insurance, life insurance, credit cards, mobile phone and NBN plans. You could save hundreds with a few phone calls.
It’s also a good time to take stock and make sure you know what entitlements you are eligible for.
You may still be working, but if you have passed retirement age, there are still benefits to be had.
If you are only working part time, you may be eligible for a part pension, and a variety of concessions such as cheaper prescriptions and healthcare as well as discounts on utility bills, rates, public transport and car registration.
However, be aware that the Work Bonus scheme will return to its previous level at 31 December, and you may have to recalibrate your pension payments once again.
Do you give your finances a once over every now and again? When and why? Why not share your strategy in the comments section below?
Also read: How to invest when you are retired?
