What will your Pension look like?

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Understanding Your PensionLet’s have a look for moment at what your pension from our Government may look like when you retire.

You’ve worked long and hard and paid your taxes – you’re entitled to a pension, right? Sure, why not. But it’s not as simple as, OK you’ve reached retirement age here’s your pension, thanks for coming.

Have you thought about how much you will get as a pension? Do you know what Centrelink takes into consideration? Will what I receive be enough to live on?

Here’s the current maximum payment rates (1):

A single person eligible for the pension is now entitled to an annual age pension – including the pension supplement and clean energy payment – of around $21,913. Around $827.10 per fortnight.

A couple eligible for the pension is now entitled to an annual age pension – including the pension supplement and clean energy payment – of around $33,036.  $1246.80 per fortnight.

Described as an ‘adequate’ income it is well below what The Association of Superannuation Funds of Australia’s Retirement Standard estimates.   They estimate a home-owning couple needs almost $58,000 a year for a ”comfortable”  retirement.  So what are you going to do?

Firstly, talk to your financial planner about what options there are for receiving the maximum amount you’re entitled to. Secondly, look at what other income streams you have. How’s your superannuation looking? What about other savings?

1. source: http://www.humanservices.gov.au/customer/services/centrelink/age-pension