Am I eligible for the Government Age Pension?

9 October 2024

People approaching retirement age often wonder ‘How much is the Age Pension?’ and ‘What Age Pension rates apply to me?’ The answers will differ according to your unique circumstances.

Around 58%¹ of Australians over the age of 65 receive either a part or full Government Age Pension. If you’re preparing for your retirement, you might be wondering if you’re one of them. In this article we’ll review several factors that determine your Age Pension eligibility, and how much you could get paid.

Factors that determine your Age Pension eligibility and the amount

To determine if you’re eligible to receive the Age Pension, the government considers your age and residency status.  

If they determine that you are eligible on this basis, they then apply the income test and the assets test to determine whether you’ll receive a full or part pension, and what the amount may be. The test resulting in the lower pension rate is the one you’d be eligible for. 

1. Qualifying Age

The age you retire from work may not be the age at which the government deems you’re eligible for the Age Pension. This is called your Qualifying Age, and it depends on the year you were born. You can start the Age Pension application process up to 13 weeks before your Qualifying Age. Learn more about applying for the Age Pension on the Services Australia’s website.

2. Residential status

Age Pension eligibility is usually reserved for Australian residents who’ve lived in Australia for at least 10 years, with at least five of those years being consecutive.

If you haven’t been an Australian resident for 10 years, there are some circumstances in which you could still be eligible for the Age Pension. For example, you could be eligible if you’ve lived or worked in a country that has a social security agreement with Australia, or you’re a refugee. 

For more details on residency rules for the Age Pension, visit the Services Australia website. 

3. The value of your assets

The government assesses the value of your assets in what's called the 'assets test'.

Tested assets include things like cars, business assets, your super, and any investments you have.  

If the value of your assets is under a certain limit, you could get a full Age Pension. This limit is different depending on whether you’re single or part of a couple, and whether you’re a homeowner. If your assets are worth more than the limit, your pension may be reduced, or you might not be eligible for it at all.   

For more details on asset limits and for a complete list of the assets considered under the test, visit the Services Australia website. 

Read more: The Government Age Pension Assets Test

4. How much income you earn

Your income is the other factor considered when figuring out whether you’re eligible for the Age Pension, and how much your payment rate might be. 

To have your income assessed, you must take what’s called the ‘income test’. This test looks at all your income sources, including, but not limited to:

• Employment, including wages you might earn from working or money you might receive from businesses you own; and 
• Investment, including your super and income created from financial assets like savings accounts, managed investments, and shares.

A standard rate called the ‘deeming rate’ is used to work out the value of investment income. The Minister for Social Services sets the deeming rate, and it can change from time to time.

For most pensioners, the standard income test applies when deciding the amount you’ll receive in your fortnightly pension. 

Under the income test assessment, your fortnightly income needs to be under $212 if you’re single. Or, under $372 a fortnight (combined) if you’re in a couple that lives together, or apart due to ill health².

For every dollar of income you earn over this limit, your Age Pension will reduce by 50c for a single person, and 50c for a couple. 

If you earn over a certain amount in a fortnight (known as the ‘cut-off point’), you won’t be eligible to receive any payments during that period.

Your Age Pension cut-off point may be higher if you get the Work Bonus. This is an incentive designed to encourage those receiving the Age Pension to work. All payments may be lower if you don’t live in Australia.

READ MORE: UNDERSTANDING THE GOVERNMENT AGE PENSION INCOME TEST

How much is the Age Pension? Current Age Pension rates

Your level of income and the value of your assets affect your eligibility for the Age Pension, as well as how much your pension payments will be. There are different rates for a single pension and couples’ pension. 

The following table lists the current maximum pension rates available in Australia per fortnight. 

You may also be eligible for additional Pension Supplement payments or Energy Supplement payments, making the total Age Pension payment higher. Visit the Services Australia website to learn more.

Your relationship status and the Age Pension

Being in a couple can affect your payment rate. Generally, Services Australia will consider you to be in a couple if you’re legally married, or in a registered or de facto relationship, and not living apart. It’s important to notify the government about any relationship changes so they can continue to pay you the right amount.

Visit the Services Australia website to learn more about relationship changes.

Age Pension increases

Adjustments to the Age Pension rate happen twice a year, in March and September. Any such increases will reflect changes to costs of living as well as wage increases. 

You don’t need to do anything to receive an Age Pension increase – you’ll just see the new amount appear in your account. 

You can find the most up-to-date pension rate on the Services Australia website.

Advance Age Pension payments

You may be able to access an advance payment of your Age Pension once you’ve been receiving it for at least three months. You’ll pay this back by having small amounts deducted from your pension payments for the next 13 fortnights (6 months). Over this period, you can apply for:  

• one advance payment at the highest amount 
• up to two advances at smaller amounts; or 
• three advances at the lowest amount. 

Visit the Services Australia website to learn more about advance payment options.

How the Age Pension works with your super

You might be eligible to receive Age Pension payments alongside your super. If so, you could draw payments from your super to top up the pension payments you’re entitled to. You can do this by setting up an account based pension. AustralianSuper’s account based pension is called Choice Income. 

LEARN MORE: HOW SUPER WORKS WITH THE GOVERNMENT AGE PENSION

The retirement age in Australia

There’s no one set retirement age in Australia. The age you finish working may not be the same as your Age Pension Qualifying Age, or the age you can access your super (Preservation Age).   

You can choose to retire from work whenever you like, however it’s useful to note that many people retire earlier than planned.

According to the Australian Bureau of Statistics (ABS), the average age people plan to retire is 65. But the actual average retirement age in Australia is closer to 57³. Reasons people retire earlier than planned include ill health, caring for a loved one, and redundancy. This highlights the importance of starting your retirement planning as early as possible.

READ ABOUT: THE DIFFERENCE BETWEEN PRESERVATION AGE AND QUALIFYING AGE

Support for planning your retirement is available

As we've outlined here, the age for pension eligibility will differ according to your specific circumstances. For that reason, it can be useful to speak to a financial adviser or ask your super fund for general advice.

Get help planning your retirement, register for a free webinar, and explore helpful articles and guides.

For personal advice, connect with one of our team members who can put you in touch with an accredited financial adviser⁴.

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