Are self-funded retirees entitled to anything?
Just because you are a self-funded retiree, it doesn’t mean that you’re excluded from accessing any benefits. In this article I’m going to go over all the benefits self-funded retirees are entitled to, including eligibility requirements and the application process.
Benefits For Self-Funded Retirees
The benefits you’re entitled to as a self-funded retiree might surprise you. While you’re probably capable of covering your retirement expenses without any assistance, a little bit of help wouldn’t go astray, would it?
There are three main benefits that a self-funded retiree may be entitled to. These include:
- Commonwealth Seniors Health Card
- Seniors Card
- Part-Age Pension
1. Commonwealth Seniors Health Card
The first benefit that self-funded retirees may be entitled to is the Commonwealth Seniors Health Card.
The Commonwealth Seniors Health Card is a card that provides concessions on health care products and services, and other discounts.
Benefits of the Commonwealth Seniors Health Care Card
The Commonwealth Seniors Health Card provides:
- Lower-cost medicine under the Pharmaceutical Benefits Scheme
- Higher likelihood of bulk -billed visits to your doctor
- A refund for medical costs via the Medical Safety Net
Other benefits for retirees include potential reduction in other costs at a state or territory level, such as electricity costs, property and water rates, ambulance and public transport.
Eligibility for the Commonwealth Seniors Health Card
To be eligible for the Commonwealth Seniors Health Card you need to have attained Age Pension age and not be getting an income support payment from Centrelink or the Department of Veteran Affairs.
Other conditions that need to be met in order for you to be eligible include:
✓ Satisfy the residency rules
✓ Complete the identity requirements
✓ Submit your tax file number (or exemption)
You also need to meet the Commonwealth Seniors Health Card income test. To meet the income test, you need to earn less than:
- Single: $90,000 per year
- Couple (combined): $144,000 per year
- Couple Separated by Illness (combined): $180,000
There is no asset test for the Commonwealth Seniors Health Card.
If you have an account-based pension, the balance of the account is subject to deeming. The deemed income is then added to any other sources of income and counted towards the income limits, above. The actual income you draw down from your account-based pension is irrelevant and not counted for income test purposes. These account-based pension deeming rules only apply if you commenced or changed your pension after 1 January 2015.
You can learn more about the CSHC eligibility here.
How To Apply for the Commonwealth Seniors Health Care Card
To claim the Commonwealth Seniors Health Card you need to have first reached Age Pension age.
Then, if you do not already have one, you need to set up a MyGov account and link Centrelink to it. The way you link Centrelink will depend on whether you have received a payment from them before, or not.
Once you have set up a MyGov account, you will need to prove your identity and submit all of the supporting documents. Supporting documents will generally include tax file number, financial information, relationship status, residency details, employment details, study details and or medical information.
You can learn more about setting up a MyGov account here.
2. Seniors Card
The second benefit self-funded retirees may be entitled to is the Seniors Card.
Each state and territory offers a Seniors Card specific to residents of that particular state or territory. These Seniors Cards can give you discounts, concessions and special offers to businesses such as restaurants, shops, transport and professional services.
Benefits of the Seniors Card
The benefits of each Senior Card will depend on the state or territory that you live in. The benefits will usually include a discount on products and services such as shops, restaurants, and professional services, as well as public services such as transport, property rates, registrations, etc.
To find out more about the specific benefits you’re entitled to search your local state government website.
Eligibility for the Seniors Card
Eligibility for a Seniors Card varies between the states and territories; however, most require you to have reached a particular age of between 60-65, depending on where you live. The other main requirement is that you need to work less than a certain number of hours per week – generally ranging between 20 hours and 35 hours.
How To Apply for the Seniors Card
The application process for the Seniors Card is different for each state and territory. Some require you to apply over the phone or in-person, while others have online applications.
This table compares the main requirements of each card:
|State||Eligible Age||Allowable Working Hours||Residency Requirement||Application Process|
|NSW||60+||20 hours or less||Permanent||Online, Phone|
|VIC||60+||35 hours or less||Permanent||Online, Post|
|QLD||60+||Less than 35 hours||Permanent||Online, Post, In-Person, Phone|
|WA||64+||Less than 25 hours||Permanent||Online, Post|
|SA||60+||20 hours or less||Permanent||Online, Post, Fax|
|TAS||60+||Less than 20 hours||Permanent||Online, Email, Post, In-Person|
|ACT||60+||Less than 20 hours||Permanent||Online, Phone, In-Person|
|NT||60+||Any||Permanent||Online, Post, In-Person|
3. Part-Age Pension
A self-funded retiree could be eligible for part-Age Pension payments now or in the future. In fact, there will be many self-funded retirees who may not be entitled to any Age Pension payments upon retirement, due to age, assets or income, but will be eligible at some point in the future.
Knowing when you might become eligible for part-Age Pension payments will be instrumental in preparing your retirement plan.
Benefits of the Age Pension
The main benefit of receiving Age Pension entitlements is that you will receive a fortnightly payment that can be used to assist in covering your living expenses. The amount you receive is means-tested, calculated on your income and assets. You may also be eligible to receive rent assistance and other payment supplements.
Additionally, if you receive any amount of Age Pension payments, you will also receive the Pensioner Concession Card. The Pensioner Concession Card provides lower cost health care, medicines and other discounts.
Eligibility for the Age Pension
To be eligible for the Age Pension, there are three main eligibility criteria that you must meet.
- Attaining Age Pension age;
- Being under the Assets and Income Test limits; and
- Being an Australian resident (usually for at least 10 years)
Read more: Can Self Funded Retirees Get the Pension
What is Age Pension Age?
Age pension age is based on when you were born, as follows:
- 1 July 1952 – 31 Dec 1953: 65 years and 6 months
- 1 Jan 1954 – 30 June 1955: 66 years
- 1 July 1955 – 31 Dec 1956: 66 years and 6 months
- On or after 1 Jan 1957: 67 years
What are the Income and Assets Test limits?
The Income Test and Assets Tests have lower and upper thresholds, and differ based on whether you are single or a member of a couple and whether you are a homeowner or non-homeowner.
Whichever test results in you being eligible for the lower amount of Age Pension payments is the Test that will be applied. The testing is applied on a continual basis – that is, your assets and income are assessed regularly and it is possible for the application of your assessment to switch between the Assets Test and the Income Test, depending on which Test results in you receiving the lowest level of Age Pension payments.
How is an Australian Resident defined for Centrelink?
On the day that you apply for Age Pension payments you need to be living in Australia, physically in Australia and be an Australian resident.
You generally need to have been an Australian resident for at least 10 years (in total), with no break in that residency for at least 5 consecutive years.
How To Apply for the Age Pension
To apply for the Centrelink Age Pension online, you will need to have a MyGov account and follow the prompts to work through the application process, as well as supply all requested documentation.
Alternatively, if you are unable to claim online, you can complete the Claim for Age Pension form and Income and Assets form and post it in, call the Older Australians phone number, or make an appointment with a Services Australia centre.
More information on how to claim the Age Pension can be found here.
Our financial planning firm, Toro Wealth, specialises solely in helping 50 to 70 year-olds optimise their financial position in the lead up to retirement. If you’re interested in learning more about our service and cost, click here.
Frequently Asked Questions
Here are some frequently asked questions relating to self-funded retiree benefits and entitlements.
Can Self-Funded Retirees Get a Pension Card?
A self-funded retiree can get a pension card. There are three main types of pension cards available to self-funded retirees.
Pensioner Concession Card – available to recipients of Age Pension payments
Commonwealth Seniors Health Card – available to Australians over Age Pension age, but not eligible for Age Pension payments. An income test applies.
Seniors Card – states and territories-based cards eligible to residents of each state and territory. Eligibility is determined by age and hours worked.
Are Self-Funded Retirees Entitled to a Healthcare Card
Yes, self-funded retirees are entitled to a healthcare card. The type of healthcare card they are entitled to is determined by their eligibility for the Age Pension. If eligible for the Age Pension, a self-funded retiree will be entitled to the Pensioner Concession Card. If not eligible for the Age Pension, a self-funded retiree may be eligible for the Commonwealth Seniors Health Card if they are under the income limits.
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