Big changes are coming to aged care and the Age Pension this year, with even more reforms on the horizon. As a result, now is the perfect time to review your finances and ensure you’re prepared. So, the big question is—are your finances ready for this year’s updates?
Age Pension Changes: Higher Asset Test Thresholds
As of this month, the Age Pension asset test has changed, bringing both opportunities and challenges.
✅ Higher asset thresholds mean you can own more before your pension is impacted.
❌ Stricter penalties now apply if you exceed the threshold. Specifically, for every $1,000 over the limit, your pension will reduce by $3—which is double the previous penalty.
Because your asset test threshold depends on whether you own a home and your marital status, it’s important to plan accordingly. To avoid any unexpected reductions, now is the ideal time to speak with a financial adviser about how these changes might affect you.
Proposed Reforms: Are More Cuts Coming?
In addition to these changes, the Grattan Institute released a report titled Age of Entitlement: Age-Based Tax Breaks, which proposes significant cuts to senior entitlements. If adopted, these measures could save the government $1 billion annually, but they may also impact your financial future.
What’s at Risk?
If these recommendations become law, they could affect:
- Seniors and Pensioners Tax Offset (SAPTO) – a key tax break that reduces tax liability for retirees.
- Medicare Levy Income Threshold for Seniors – potentially leading to higher Medicare costs for wealthier retirees.
- Private Health Insurance Rebate for Seniors – aligning it with the rebate younger Australians receive, reducing benefits for older individuals.
While these changes primarily target self-funded retirees and those receiving a part Age Pension, it’s worth noting that full pensioners would see little to no impact. However, since these proposals are still under review, preparing ahead remains a smart financial move.
Stay Ahead & Protect Your Future
With superannuation and pension rules evolving frequently, staying informed is key. By regularly reviewing your retirement strategy, you can ensure it stays resilient, no matter what new policies emerge.
Furthermore, having expert guidance can make all the difference. So, don’t wait until the changes take effect—speak with the Trusted Aged Care Services team today. Call us at 07 5610 4909 for a personalised review of your financial situation and secure your peace of mind. So, it’s time to ask – Are your finances ready?