Age Pension Myths and Misconceptions

Myth: You need to be retired to claim Age Pension.  

Reality: Many people are eligible for a pension while still working. Income will reduce your pension amount. You can apply from 66 years and 9 months, and payments can start from age 67.   

Myth: Age Pension is for everyone who is paid taxes in Australia during their working years.

Reality: Age Pension has means testing. It is reserved for those who cannot afford to support themselves in retirement. Your history of paying taxes (or not) has no bearing on your eligibility for Age Pension.

Myth: If you have super you need to spend it all before you can claim Age pension.

Reality: you can have some super when you claim Age Pension. The amount you have in super may reduce your pension. The asset limits differ depending on single vs partnered, homeowner vs non-homeowner.  

Myth: Both members of a couple get Age Pension when one turns 67.

Reality: The couple-combined rate is for when BOTH members of a couple are ELIGIBLE for the pension. If one member is under 67yo, or is otherwise ineligible, the amount paid is half the couple combined rate. This pic shows the amount one adult gets.  The younger partner may be eligible for Jobseeker payment when working part time, full time, or volunteering.

Myth: if you increase your super drawdown amount it reduces your Age pension Reality: your Age pension amount is based on your total super balance, not on the amount you take. You can change the % drawdown with no effect on Age Pension.  

Myth: there are no benefits for people who have too much income /assets for Age Pension

Reality: most people over 67yo will at least be eligible for the Commonwealth  

Seniors Health Card - income limit as shown.  Many retirees (any age) will be eligible for the Low-Income Card.  As your assets reduce and the Pension limits increase, at some point you are likely to be eligible: for Age Pension.