The Centrelink Age Pension is vital for many Australian retirees, providing financial support during their later years. However, many eligible pensioners may not be receiving the maximum benefit they are entitled to. If you want to maximize your Age Pension in 2024, this guide offers useful strategies to help you secure the best possible payments while adhering to Centrelink’s rules.
Understanding the Maximum Centrelink Age Pension in 2024
As of July 2024, Centrelink has adjusted the Age Pension rates in response to inflation. The maximum payment for singles is now $1,116.30 per fortnight, while couples receive a combined total of $1,653.40. While these figures reflect cost-of-living increases, many pensioners still find that their payments don’t fully cover their expenses.
The Age Pension is determined by both income and asset tests. To optimize your Age Pension, it’s essential to understand these tests and use strategies that can reduce your income and asset assessments legally. These may include gifting, restructuring assets, or investing in products like lifetime annuities.
Key Age Pension Criteria for 2024
- Maximum fortnightly payment:
- Singles: $1,116.30
- Couples: $1,653.40 (combined)
- Income threshold for full pension:
- Singles: Up to $212 per fortnight
- Couples: Up to $372 per fortnight
- Asset threshold for full pension:
- Homeowners (singles): $314,000
- Homeowners (couples): $470,000
- Non-homeowners:
- Singles: $938,250
- Couples: $1,283,000
- Work Bonus: Allows pensioners to earn additional income without reducing their payments.
Strategies to Boost Your Age Pension
While Centrelink uses income and asset tests to determine your pension, there are several legal strategies you can use to boost your payments in 2024. Below are some effective approaches:
1. Gifting to Reduce Assessable Assets
One of the most straightforward ways to lower your assessable assets is by gifting money to family members. You are allowed to gift up to $10,000 per financial year, with a maximum of $30,000 over a five-year period, without affecting your pension. This strategy can help reduce your asset base, which could result in a higher pension.
2. Prepaying Funeral Expenses
Another way to reduce your assets is by prepaying funeral expenses or purchasing a funeral bond. Up to $14,000 spent on a funeral bond is exempt from Centrelink’s asset test. This not only decreases your assessable assets but also allows you to plan ahead for future expenses, potentially increasing your pension by about $1,092 per year.
3. Utilizing Superannuation Contributions
If your spouse is younger than Age Pension age, consider making superannuation contributions in their name. Superannuation in the accumulation phase is not counted in Centrelink’s means test until your spouse reaches the pension age. This could help you reduce your assessable assets and increase your pension by up to $12,870 annually.
सम्बंधित ख़बरें
4. Investing in Lifetime Annuities
A lifetime annuity is a financial product that can help you increase your Age Pension. Only part of the annuity’s value is counted in the assets test. For example, if you invest $100,000 in an annuity, only a portion of it may be considered an asset, potentially boosting your pension by as much as $3,120 per year.
5. Taking Advantage of the Work Bonus Scheme
For pensioners who are still working, the Work Bonus allows you to earn an extra $300 per fortnight without reducing your Age Pension payments. This benefit is available to both singles and couples, meaning you can earn more while still receiving the full pension.
6. Structuring Investment Loans Strategically
If you own an investment property, the way you structure your loans can affect your pension. For example, securing a loan against an investment property (rather than your home) can reduce the property’s assessable value under Centrelink’s means test. This strategy could increase your pension by as much as $15,600 annually.
Other Payment Details
- Home Equity Access Scheme: This scheme offers older Australians the option to unlock some of their home equity to boost their pension. In 2024, the amount accessible through this scheme is $21,876.
- Other Payments: In addition to the Age Pension, you may be eligible for other support, such as the Carer Payment ($841 for September 2024).
Frequently Asked Questions
- What are the asset and income thresholds for a part pension in 2024?
For singles, you can have assets up to $686,250 (homeowner) or $938,250 (non-homeowner) and still receive a part pension. For couples, the thresholds are $1,031,000 (homeowners) and $1,283,000 (non-homeowners). - How does the Work Bonus scheme work?
The Work Bonus allows you to earn up to $300 per fortnight from employment without it affecting your pension payments. This helps you supplement your income while still receiving the full pension. - Can selling or gifting assets increase my pension?
Yes, if you sell or gift assets within Centrelink’s allowable limits, it can reduce your assessable assets and potentially increase your pension. The maximum you can gift is $10,000 per year and $30,000 over five years. - How do lifetime annuities help with the Age Pension?
Lifetime annuities are partially exempt from the asset test, allowing you to retain more of your pension while still benefiting from the annuity’s income.
By utilizing these strategies, you can make the most of your Age Pension in 2024 and secure a more comfortable financial future. Always consult a financial advisor to ensure that you’re taking the best approach for your individual circumstances.