QHA November 2017

SUPERANNUATION with Brendan O’Farrell
INCREASE TO THE AGE PENSION AGE
QHA REVIEW | 28
In all my discussions about super, one thing I don’t
get to mention much is the Age Pension. But the Age
Pension forms an important part of many people’s
retirement plans. And there’s been a recent change
that could impact your plans to access the Age
Pension when you decide to retire.
On 1 July 2017, the Age Pension age was increased
from 65 to 65.5. For those who are approaching 65,
you will now have to wait an extra six months before
you can access the Pension.
The Age Pension age is legislated to continue rising
until it reaches 67. The increases will occur every two
years in six month increments. So, after 1 July 2019,
you will need to be 66 to access the pension and
66.5 after 1 July 2021. It will stop increasing once the
access age reaches 67 on 1 July 2023.
This could change the retirement plans of many QHA
readers. If you were born after 1 January 1957, you will
not be eligible to access the Age Pension until you are
67. The Government’s aim is to bring the Age Pension
age more in line with our increasing life expectancy.
People are living longer in retirement, which has vastly
increased the cost of providing the Age Pension to all
eligible Australians.
Despite the increase in our life expectancy, most
people aren’t planning to retire any later. For many
Australians, 65 remains the age they intend to stop
working. But without access to the Age Pension, this
could get more difficult. An extra two years can be
quite a long time to wait for the Pension, especially if
you were planning to retire soon.
Remember, although the Age Pension age has
increased, the super age has not. You can now
access your super earlier than you can access the Age
Pension. You can use your super once you reach your
preservation age (between age 55 and 60, depending
on when you were born) and retire. Once you reach
65, you can access your super even if you are
still working.
If you had planned to retire at 65, but are now
concerned about managing your finances without the
Age Pension, you could access your superannuation
to draw yourself an income stream. Even if you don’t
have a large superannuation balance, you might be
able to manage an income stream for a couple of
years until you can access the Age Pension.
If retirement is still a few years away, it might be
beneficial to start boosting your super now. There are
some strategies you could look into to help to grow
your super while you’re still working. An increased
super balance could help you retire at 65, even without
access to the Age Pension.
If you’d like some advice on boosting your super, or on
managing retirement without the Age Pension, come
in and talk to our financial advisers at Intrust360°.
Whatever your financial situation, financial advisers can
help you manage your finances and retire as planned.
Call 1300 001 360 to book an appointment.
The information contained in this document is of a general nature only,
and does not take into account your individual situation, objectives
and needs. You should consider the appropriateness of the general
information having regard to your own situation before making any
investment decision. A Product Disclosure Statement is available at
www.intrust.com.au or call us on 132 467 for a copy.
Financial planning is provided by IS Financial Planning Pty Ltd ABN
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