What You Need To Know About The Australian Aged Pension

What You Need To Know About The Australian Aged Pension

With the long years of hard work behind you, retirement can be an exciting time. One of the challenges of this milestone is the difficulties of navigating the aged pension. Australia has a complex pension and superannuation system, and every part of the process can be daunting: from working out ‘how much aged pension will I get?’ to actually applying.

At Lady Anne Funerals, we’ve helped many older Australians with financial arrangements surrounding their retirement. From budgeting for your retirement, to writing a will, to exploring options for prepaid funerals Sydney, there are several steps you can take to prepare for your financial future post-retirement.

To help you through, here’s a guide to the basics of the Australian aged pension: how to apply, eligibility rules, and recent changes to the system.


The Australian aged pension: the basics

At present, to be eligible for the aged pension, you need to be an Australian resident, physically living in Australia, and at least 65 years of age. However, it is set for the pension age to increase gradually from 2017 onwards, until it reaches 67 years by 2023.

An income test and assets test are both applied to determine how much payment you’d receive. These also take into account whether you’re a single person or part of a couple.

Under the income test, your pension is reduced depending on how high your income is – whether that comes from your salary, or any rental properties or investments you may have. For every dollar you exceed the threshold, your pension would be reduced by 50c.

The value of your assets, such as your car, investments and household goods, also impacts your pension. But the family home or principle residence is excluded from the asset test. For every $1,000 by which you exceed the asset threshold, your payment will be reduced by $1.50.

In addition to the basic pension rate you may also receive supplements that aim to help with your utility costs, as well as a pension concession card. This entitles cardholders to lower medicine costs plus concessions on public transport, utilities and council rates, depending on their state and local government.

For those who continue working past the retirement age, hoping to semi-retire or receive the part pension, it’s a little more complicated. The income test will exclude the first $250 of income you earn per fortnight.


How and when to apply for the aged pension

While it’s wise to begin planning and preparing for your retirement well in advance, you can lodge a claim for the aged pension up to 13 weeks before you reach the age of eligibility, or register an intent to claim on the day you first qualify for the age pension.

Apply on the Australian Government’s Department of Human Services website or by lodging a form at your local Centrelink centre.


Recent updates and changes to the pension system

The 2015 budget introduced a number of changes, including a stricter assets test on the aged pension and an adjustment to the thresholds – meaning that those in the lower threshold will receive a larger pension while the wealthier will receive less.

From 1 January 2017, more Australians will be eligible for the full aged pension due to an increase in the assets test limit from $286,500 to $375,000 for couples and from $202,000 to $250,000 for singles.

Changes in last year’s budget also mean that in the future your pension may be reduced by $3 per fortnight for every $1,000 of assets you own over the full aged pension threshold, compared to its current rate of $1.50 per every $1,000 of assets.

Retirees at the upper limit of the aged pension will be affected by adjustments to the maximum limits, which will decrease from assets of $1,151,500 to $823,000 for couples and from $775,500 to $547,000 for single people.

Importantly, certain costs will be excluded from asset tests (in addition to ownership of the family home, which remains excluded). This includes funeral planning: individuals are allowed to prepay their funeral costs up to $12,000 without it being subject to an asset test.

As of January 2016, another change was introduced lessening the amount of income from defined benefits super schemes that can be exempted from the aged pension income test. This change has mainly affected those who worked in the public sector as former public servants, teachers, nurses, police officers and firefighters.

There is also discussion underway to make changes to the aged pension and superannuation system, especially around super tax breaks. Stay tuned.


How you can prepare for your retirement

One of the most important factors in your decision about when to retire is the amount of money you have saved in your superannuation, assets and investments alike. You should also talk to a financial planner or advisor well before you retire to help assess your individual situation.

It’s also important to consider ways to lessen the financial burden for you and your family wherever possible, both before and after you go on the pension. Pre-paying your funeral expenses, pre-purchasing a burial plot or investing in funeral bonds are some avenues you may like to explore.

According to current legislation, any money you pay for a prepaid funeral plan is not subject to the income test or asset test described above. This means that you can help ease the financial burden on your family when you pass by paying for your funeral in advance at a fixed cost in today’s prices, regardless of whether the funeral takes place within the next decade or well into the future.


At Lady Anne Funerals, we are happy to talk you through different options for a prepaid funeral and service that suits you. If you’d like to learn more about our prepaid funeral plans, get in contact with one of our experienced funeral directors today. For more advice on how to prepare for this important milestone, download our free retirement planning guide below.

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Our compassionate all-female team are dedicated to supporting families in their times of need. We arrange beautiful personalised funeral services in the Gladesville & Sydney area.



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Lady Anne Funerals is here to support and assist your family through what can be a difficult time, with a ladies touch. 

We are available to discuss a range of services to support your family, including: 

  • Personalised memorial services
  • Cremation and burial services
  • Religious services catering to all faith's
  • No service, no attendance 

Please get in touch - night or day - via the form or you can call us on the number below.

Phone: 1300 74 00 74

206 Victoria Road, Gladesville 2111

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Some of the families we've helped

My family and friends were very happy with every aspect of the preparation and celebration of the end of my wife. When I knew the end was near I spoke to Yvonne who explained to me what would happen and this was done with delicacy and tact. When the end came Yvonne came to our house and explained every aspect of what would happen. We explained what we wanted for Margaret's farewell and nothing was too much trouble for Yvonne to explain or discuss. On the day of the funeral everything went like clockwork and all my relatives and friends told me how impressed they were. So thank you to Yvonne for being celebrant and MC at the farewell and thank you to all the Lady Anne team. If I were asked to score the service my family received  it would be ten out of ten.
Dick Hodge
I would like to thank you and the whole team at Lady Anne Funerals for making mums funeral the perfect goodbye. The funeral was everything and so much more than mum wanted. Nothing seemed to be too hard and that made my time far simpler than i had expected. 
The whole day was perfect and we noticed with love all the special touches from the bookmarks to the candle to the display screen with Iris's. Thank you so much. Your team felt like part of the family rather than people doing a job.
That i believe is what sets Lady Anne apart.
I cant thank you enough.

I want to send a heartfelt 'thank you’ to you both, and your team, for your compassion and your assistance in taking meticulous care of Dad and arranging such a beautiful end of life service for him. Within a matter of only a few days, which included a weekend, you were able to organise the perfect service tailored to our requests.

Not only did you organise the attendance of the RSL representative, you also went to considerable trouble to download the music and videos we had chosen, in a format that could be utilised in the service.We greatly appreciated your guidance too with organising the order of service and arranging a printed copy of the tributes for one of our friends who was deaf.

Thank you Yvonne for doing a magnificent job as the celebrant. We greatly appreciated you reading our tributes to Maurie on the family’s behalf. Thank you too for reading the poem, 'The Dash’ so beautifully.

It was comforting for our family and friends to come together in a more intimate setting, which your chapel provides. The light refreshments, which followed the service, were ideal, allowing the family to stay on and share their memories.

Dad quite often had high expectations of the way things should be done, bless him, so I was particularly mindful of doing him proud with this last expression of our love for him and a tribute to his long and meaningful life. We achieved this, with your help, and I know he would have been deeply touched and honoured. Thank you for you for all you did.


"I just wanted to say a big thank you to you and your amazing team. I couldn’t have asked for things to go any better. Everything was perfect. And your ladies were beautiful. Your Yvonne is amazing. She is patient, compassionate, caring and delivers perfection in all the elements of the proceedings. She has been an absolute Gem.

Once again thank you so very much. I would highly recommend anyone to use your company if they want a perfect funeral service. 5 star service. 5 star outcome.

There were multiple compliments on the service, on your ladies and on the care from the attendees. I’m more than happy for you to post this on any media platform as a compliment and tribute to your company.

Thank you."

Anne Leslie
“I just wanted to send you our sincerest thanks for everything you and your incredible team did for us in making the most perfect day, celebration and farewell of our beautiful Harper.

I have given a lot of thought to your business and the industry and I think it is perhaps the most important business for families to get it right when it comes to planning a funeral which may be sudden or may be a long time in the making. Either way, when one is faced with the unfortunate situation of needing to arrange a funeral, only then do you realise the importance of getting it right.

We experienced first hand the polar opposites the industry offers. It is not just about the cars, the booklets, the music and all the things that make up the day - its about the service, the care and most importantly it’s about the people.

From our very first conversation we could sense your genuine care to our situation and your attention to detail was obvious - this was very different to the previous conversations we had with others we had been referred to. Those other companies wanted to commence meetings with the paperwork side of things upfront which is a very confronting thing to do just days after losing your loved one - and when one of the others that I am referencing couldn’t even refernece our daughters name as our meeting started - we were horrified of how poor the service of care could be.

This is where you and your team shine. After feeling very lost in our search to secure the perfect funeral director to create the perfect day, my wife all of a sudden recalled you standing out the front of your office each morning watering the surrounding gardens to ensure a beautiful front of house. Well, I can assure you, it is not just the front of house that is beautiful - its the entire package that is beautiful.

Your manner, your direction and your expertise is evident from the get go. Nothing is too hard for you or your amazing team. The personal care made us feel like we were the only funeral you were working with at the time, and that’s exactly how it should be.

The finer detail, such as driving past our house so our daughter could go past our house one last time, then leaving the most beautiful flowers on our doorstep, to bumping into us at the Church because you were just doing your own research to make sure the day was seamless. This combined with your recommendations from every aspect as everything was very foreign to us, you were able to guide us to achieve the most beautiful farewell.

The day itself was simply perfect. Not once did we have a concern. The car was shining, your team dressed beautifully, cold water provided for us, directions for our guests, directions for us. Everyone commented on how amazing the day was and how incredibly your team were. Seamless is the only word I can use. It doesn’t stop here.

Your personal care and guidance then allowed us a more intimate farewell the following day (we are so grateful for for this recommendation and possibly would have missed this special day if you had suggested it was the best idea). Again, you and your team made us feel like you had nowhere else to be, and no one else to help. Just us. The setting was beautiful, the celebrant (that you arrange and recommend) is a delightful, your team make this day even more special than the last.

This is something we never want to go through again but there will be so many others, that like us, have no idea where to start to look for the right funeral director for their own special day. All I can say is that I hope that they appoint Lady Anne Funerals. We learnt a lot quickly and it is again a business many do not ever consider needing but without question one of the most important businesses to select the right person and the right team.

I welcome any of your future potential clients to contact me if they wish to discuss our experience with the amazing Lady Anne team. We thank you for giving our beautiful baby the most incredible farewell that was exactly how we imagined it, you just made it happen.”

Lee Dowdall

“We wish to thank you for having helped us put together a beautiful farewell for our mother, one which she would have been delighted with.

It was a difficult day and it would have been worse without your synchronised, seamless and consistent presence as well as attention to detail.

We value your candour as the people you are and the very sensitive manner in which you conducted the service.

Thanking you from the bottom of our hearts,

The Pastore Family
Karen has supported my Mum and me through the most difficult week of our lives as we not only planned a funeral, but interred my Dad to his new home. I will be forever grateful to Karen for her ongoing support, guidance, kindness, empathy and friendship over the last week. Karen has now become part of our extended circle of close family friends.
Daughter of the late Sveta Dordevich
Lady Anne Funerals has the compassion, understanding and empathy that many of the larger funeral homes do not possess. My aunts funeral was dignified and classy everything she deserved. I would highly recommend Lady Anne (and have) as they go above and beyond.
Joanne Marks
I am overwhelmed with the feedback on how beautiful it all was from all who attended. You and the other ladies were wonderful, looked so elegant, and made the day so very special for all who loved Paul.
Barbara Sommerville Enright
Karen and her staff treated us with the utmost respect we could not have been in better hands during this difficult time. My mum had organised her funeral with a prepaid funeral plan which she had purchased from Karen almost ten years ago this also made this upsetting time much easier to deal with and she got all the things that she wished for.
Malcolm Ellis
On behalf of my family, I would like to thank Lady Anne Funerals for a beautiful service yesterday for my aunt Dot. All who attended commented on how lovely the service was & the professionalism of all the staff. Thanks again very much for helping making a sad day one of celebration of Dot’s life.
Judith Neville

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