What can be done to increase your income in retirement
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- By Suzie Barnaby
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- 18 September 2019, 1:58 PM
Receiving an Age Pension, and maximising the level of Age Pension received, are common goals of many retired Australians. Benefits available through the Pensioner Concessional Card, include cheaper medicines and healthcare, discounted utility bills and transport costs.
For some, the Age Pension provides a certain, inflation indexed income stream to help with meeting income needs in retirement.
What a lot of people don’t know is that there are various actions and strategies that may be undertaken to increase your Age Pension entitlements.
Below is a list of three actions that you may be able to take to increase your Age Pension:
- Ensure Centrelink have appropriate valuations for your non-financial assets such as household contents and motor vehicles.For example, the value for a motor vehicle should be at resale or market value, not the amount paid for a vehicle.
- Consider pre-paying funeral expenses or purchasing a funeral bond which will reduce your level of financial investments.
- Gifting to family may be something of interest, however there are strict rules around the level of gifting able to be undertaken. It’s important to note that the value of any assets that are gifted or sold for less than their value may still count towards your income and assets test when determining pension entitlements. Also, if you gift your assets, you lose control over them, and they are no longer available to you if required. This could reduce your choice and flexibility in the future.
There are several other strategies than can be considered to deliver an increase in Age Pension. It is important to consult with a financial adviser to see what strategies are available to you. Your financial adviser will help you work through the various options and consider in full the benefits versus the implications and risks of undertaking a particular strategy.
While there are various ways available to maximise your Age Pension, we recommend that you don’t look at maximising your Age Pension in isolation. Always refer to your overall goals and objectives for retirement to ensure that these actions help you both in the short and the long term.
Find out more
Suzie is a Senior Financial Planner at Morgans Port Macquarie. Suzie’s passion is supporting and educating clients so they can make well-informed decisions in relation to their own financial situation.
If you would like to learn more about assessing your finances, you can contact the Morgans Port Macquarie office on [email protected] or via (02) 6583 1735.
General Advice warning: This article is made without consideration of any specific client’s investment objectives, financial situation or needs. It is recommended that any persons who wish to act upon this report consult with their investment adviser before doing so. Morgans does not accept any liability for the results of any actions taken or not taken on the basis of information in this report, or for any negligent misstatements, errors or omissions.
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