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The limits on the value of assets you can own and the amount you can earn in retirement, while still qualifying for the pension, rise today.
This is due to biannual indexation, which ensures the asset and income tests and the pension payment itself keep pace with inflation.
Australians become eligible for the age pension when they hit ‘retirement age‘, which is 67 years for those born on or after 1 January 1957.
The pension is subject to an asset test and an income test, which use biannually adjusted thresholds to determine whether you qualify.
If you own assets or earn wages below the lower thresholds, you will qualify for a full pension.
If you own assets or earn money above the lower thresholds but beneath the upper thresholds, you will qualify for a part pension.
In this round of indexation changes, it’s the upper threshold limits only that are changing. The lower thresholds are staying the same.
Let’s go over the changes, starting with the assets test.
How much can you own in retirement and still get a full or part pension?
Before we begin, just a quick reminder that your primary residence is excluded from the assets test.
Let’s recap the lower thresholds, which are not changing today.
Single homeowners can own $321,500 in assets outside their main residence, and single non-homeowners can own $579,500 in assets outside their home, and still qualify for the full pension.
Couple homeowners can have $481,500 in assets and non-homeowners can have $739,500 in assets and still get the full pension.
Now to the upper thresholds, which are rising today.
Single homeowners will qualify for a part pension if their assets are worth less than the new upper threshold of $714,500.
Non-homeowner singles can get a part pension if their retirement assets are worth less than their new limit of $972,500.
Couple homeowners can now get a part pension if their assets are valued up to $1,074,000.
Non-homeowner couples can own up to $1,332,000 in assets and still qualify for support from today.
But wait, there’s more.
You need to satisfy the income test to qualify for the pension, too.
How much can you earn without losing your pension?
Let’s follow the same course with the income test and its thresholds.
Here are the lower thresholds, which are not changing today.
Single Australians in retirement can earn $218 per fortnight and couples $380 combined per fortnight and qualify for the full pension.
From today, the upper thresholds of the income test are going up.
Singles will now be able to earn up to $2,575.40 per fortnight, and couples up to $3,934 per fortnight, and still qualify for a part pension.
How much is the pension?
So glad you asked — because pension payments are also rising today.
To find out exactly how much more pension you will receive in retirement from today, view our article here.