How safe is your income and pension? This will be your livelihood as you exit the workforce, and as such, it needs the utmost protection. However, new changes have been introduced for pensioners courtesy of the Australian government, which could see your retirement income reduced.
Some will benefit, some will lose; what is important to understand is where you sit and how to manage any changes to your planned retirement cash stream.
So what are these changes, how will they impact you, and how do you move forward if your income is affected?
Changes inbound for assets testing
Assets testing is going to change from 1st January 2017. Specifically, the value your assets can be before entitlements are lost and pension reduced is increasing to the following:
- $250,000 for single home owners,
- $375,000 for a couple owning a home,
- $450,000 for a single non-home owner, and
- $575,000 for a couple without a home.
You lose $3 per fortnight for every $1,000 you have above these limits, which is something everyone approaching retirement should keep in mind. Will this important income support measure still apply to you after January 1? If not, do you have the right financial advice to continue with a comfortable retirement?
Who will still get a pension?
According to Super Guide, an estimated 300,000 Australians will lose some pension entitlements come 1 January 2017, due to the value of their existing assets. Many people that have spent a considerable amount of time building up their superannuation alongside other investments will now find this precludes them from getting income assistance as they try to leave the workforce.
For a wide range of Australians, this is going to mean retirement planning needs to undergo changes. At Invest Blue, we understand the gravity of the situation many people may now find themselves in, which is why we have prepared two seminars to assist people in understanding where to go next.
We are holding special information events in 3 of our offices in the coming weeks. These events are open to anyone who is interested and are at no obligation. Feel free to come along and bring a friend.
Register for information event 23rd Nov in Penrith
If you are located near one of our other offices and would like more information, you can get in touch with your planner directly or read more about the changes.
What you need to know
This information is provided by Invest Blue Pty Ltd (ABN 91 100 874 744). The information contained in this article is of general nature only and does not take into account the objectives, financial situation or needs of any particular person. Therefore, before making any decision, you should consider the appropriateness of the advice with regards to those matters and seek personal financial, tax and/or legal advice prior to acting on this information. Read our Financial Services Guide for information about our services, including the fees and other benefits that AMP companies and their representatives may receive in relations to products and services provided to you.