Pension advice

The 70% rule for pension refers to the guideline that suggests retirees should aim to replace around 70% of their pre-retirement income to maintain a similar standard of living. This percentage includes income from all sources, such as superannuation, pensions, and other investments.

Here’s how it works:

• If you earned $100,000 annually before retirement, you’d aim for $70,000 in retirement income.
• This can come from a combination of your age pension, superannuation, and other savings, such as an account-based pension.

We’ll help you determine the right mix of income streams to achieve this goal, ensuring your retirement is comfortable and financially secure.

Maximising your age pension income involves a combination of strategies:

1. Reviewing your entitlements: Ensure you’re receiving the full amount from superannuation, government pensions, and any private schemes.
2. Optimising contributions and withdrawals: Make strategic super contributions and plan withdrawals to minimise tax.
3. Structuring assets efficiently: Certain assets may be exempt under the age pension assets test, such as your primary residence.
4. Managing income streams: Balance your superannuation income, dividends, and rental income to stay within income test thresholds.

For those who may need to access larger amounts, considering a lump sum withdrawal from your super can also provide flexibility for significant expenses. Our tailored advice ensures every aspect of your pension plan is optimised to maximise your retirement income.

The amount of money you can have while still qualifying for the age pension depends on the income and assets tests set by Centrelink. These limits vary based on your living arrangements (homeowner vs. non-homeowner) and whether you’re single or part of a couple.

As of now, here’s a general guide for homeowners:

• Single: Up to $301,750 in assets (excluding your primary home).
• Couple (combined): Up to $451,500 in assets.

For non-homeowners:

• Single: Up to $543,750 in assets.
• Couple (combined): Up to $693,500 in assets.

The income and assets test also applies, which could affect your eligibility. If your financial assets or income exceed the thresholds, your pension payment may be reduced or stopped. Additionally, holding a Commonwealth Seniors Health Card could provide further benefits even if you exceed the age pension limits. We’ll help you assess your situation and maximise your entitlements.

Not all pension income is taxed the same way, and understanding the tax implications can help you retain more of your income.

• Superannuation pension income: Generally tax-free for those aged 60 and over if drawn from a taxed super fund.
• Age pension: Typically falls below the taxable income threshold, so it’s often tax-free.
• Other income streams: Dividends, rental income, or part-time work may require you to pay tax at your marginal rate.

We’ll help you structure your income streams to minimise tax and keep more money in your pocket.

Yes, you can work while receiving your pension, but your earnings may affect your age pension payments under the income test. The Work Bonus scheme allows eligible pensioners to earn more without immediately reducing their pension.

Here’s how it works:

• The first $300 of income from work per fortnight is excluded from the income test.
• If you don’t use the $300 allowance in a fortnight, it accrues up to a maximum of $7,800 annually.

This means you can work part-time or casually while still maintaining most, if not all, of your age pension. We’ll help you navigate these rules to ensure you’re making the most of your entitlements.