Plan now for pension assets test changes

National Seniors is urging its members to check if they will be impacted by the Age Pension assets test which comes into force from 1 January 2017.

Media reports this week have said that affected pensioners will not be officially notified until Centrelink sends them a letter shortly before Christmas.

National Seniors Chief Executive Dagmar Parsons said some older people are very anxious and need help to understand how the changes will affect them, so they can consider their options.

“Many people are still unaware if or how the assets test changes will impact their payment rates,” Ms Parsons said.

“Doubling the taper rate is too severe and the change will surprise some part-pensioners given the asset cut-off limits are lower than previously advised.

“Those close to thresholds would need to act quickly and adjust their affairs in the next couple of months, if doing so is right for their circumstances.

“Preparing now may make a world of difference to their financial well-being in the New Year.”

Ms Parsons said members can get more information about the assets test changes from the National Seniors Financial Information Desk on 1300 020 110 or email fid@nationalseniors.com.au.

The Department of Human Services also has an online tool which older people can use to estimate the impact on their pension.

Ms Parsons said that National Seniors had campaigned hard against implementation of the pension assets test, which was announced in the federal budget last year and is now in legislation.

While the family home will remain exempt, the new rules will reduce payments for a single, home-owning pensioner with assets worth more than $250,000.

The assets test-free area for a home-owning couple will be $375,000; for a single non-homeowner $450,000; and for a non-homeowner couple, $575,000.

Pensioners will be subject to a new taper rate of $3 for every $1,000 above the new assets test-free areas.

Those who lose their payments from 1 January will get a Health Care Card and those over Age Pension age will get a Commonwealth Seniors Health Card.

People who are in severe financial hardship and have little or no entitlement to a payment, can apply to be paid under the Asset Hardship provisions.

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