If you get the pension and intend to travel around AU and also maybe if you intend renting out your home
this may interest you ......
My husband and I are thinking of renting out our home so we can travel in our caravan for 12 months. Both of us are on the Age Pension. We think we could earn $450 a week in rental income. How would this affect us? We have no investments and only a very small amount of superannuation left. ,,,,,
If you are on the aged pension I would suggest your first port of call would be Centerlink. You will get accurate and up to date info straight from the horses mouth.
If you are on the aged pension I would suggest your first port of call would be Centerlink. You will get accurate and up to date info straight from the horses mouth.
Alan
Very sound advice.
Each and every persons requirements and entitlements are different,
I feel you will only get samples of others entitlements if relying in this type of info from a forum.
In short, if you rent out your home the rent is considered income. If you as a couple earn more than $336 per fortnight, you will lose $0.50 from your pension for every dollar over the $336. This may have changed so need to check the current rates.
But, its not a simple as that, if you rent out your home there are expenses you can claim that will obviously reduce the weekly amount you will earn
What you need to do is seek independent financial advice.
Others may suggest other options but a forum is not the place for those discussions if you know what I mean.
-- Edited by shakey55 on Friday 22nd of July 2022 06:24:10 AM
In short, if you rent out your home the rent is considered income. If you as a couple earn more than $336 per fortnight, you will lose $0.50 from your pension for every dollar over the $336. This may have changed so need to check the current rates.
But, its not a simple as that, if you rent out your home there are expenses you can claim that will obviously reduce the weekly amount you will earn
What you need to do is seek independent financial advice.
Others may suggest other options but a forum is not the place for those discussions if you know what I mean.
-- Edited by shakey55 on Friday 22nd of July 2022 06:24:10 AM
it is a good place to get ideas as to were to start looking for information
it is a good place to get ideas as to were to start looking for information
dogbox
yes you are absolutely correct a very good starting point. You probably misunderstood what I was leading to. There may be people that suggest ways to dodge Centrelink (not a good idea), and its this I meant the forum was not a place for that discussion.
cheers
-- Edited by shakey55 on Sunday 24th of July 2022 05:24:00 AM
I used to be a Centrelink Financial Information Service Officer. Here's how it works - There are 2 means tests - income & assets. Centrelink applies both & whatever gives the least pension is the one they apply.
For the income test, it's the rent less any expenses. As a rule of thumb this is usually a third. So $300 per week is assessable. Add any deemed income from bank accounts, investments and super/super pensions. Let's say your deemed income is $20 per fortnight. Your assessable income is then $620 per fortnight. As a couple you can have $336 income per fortnight without loss, then every $2 of income after that means you jointly lose $1 per fortnight pension. So in this case, the joint pension loss would be $142 per fortnight.
For the asset test, because you are no longer living in your home, your van is counted as your home. So the van is exempt from the asset test, but the rented home becomes an assessable asset. You can have assessable assets of $419,000 before losing pension. It then can become quite savage, because you will jointly lose $3 per fortnight for every $1,000 of assessable assets over that threshold. For example - say your home is valued at $600,000, and you have $100,000 of other assets -eg super, car & possessions, your total assessable assets are $700,000. Take away the allowed amount and you have $281,000. Divide by $1,000 and multiply by 3 and you have a pension loss of $843 per fortnight.
So you would be getting $600 net per fortnight from rent(after costs) and losing $843 per fortnight pension.
I am currently a financial adviser, and have been through this exercise several times in the past couple of years. Given current high real estate prices, I have not yet seen a case where it is a financially viable strategy for age pensioners. It can be different if under age pension age & your house isn't too high in value.
As suggested, please check with Centrelink to confirm this.
It seems to me that a couple would come out ahead if they were to engage a house sitter. Then their home would remain a non-assessable asset. Is that how it works?
__________________
"No friend ever served me, and no enemy ever wronged me, whom I have not repaid in full."
If they engage a house sitter (who didn't pay rent) then the home remains their Centrelink home and no affect at all on the pension. No financial advantage at all, but you have the advantage of not having a vacant home. As soon as you ask for money, the house becomes assessable.
