One of the first steps in eradicating the Age Pension
- Thread starter Mr. Fabulous
- Start date
If you expect them to fund their own retirement and not get the pension, they would have to liquidate. It's a lot to ask elderly people, who rely on community connections and the safety of the known, to uproot and go elsewhere.
Sell their house and downsize like any sensible person who can't afford to support themselves. But I guess that equates to 'throwing them out of their home' to you?
Centrelink and Department of Veterans' Affairs have a little-known Pension Loan Scheme where those on a part age pension, who own their own home or investment property, can take out a loan that is repaid when the property is sold. The loan has to be taken as an income stream and is limited to that which, when added to the part-pension, takes them to the maximum pension.
Read more: http://www.theage.com.au/money/supe...is-just--for-the-wealthy-20141002-10p4tt.html
That's a good idea.
They could chose to sell the home and purchase a cheaper one and use the remaining cash until it reduces their assets to pension limit. Quite a few people already do or plan to do this.
In my way of thinking, somehow the govt implements a cut-off mark for the value of the family home. Below a certain value it does not affect the pension. Above a certain amount, it affects the pension. In a lot of cases this cash in hand may well be low enough that it does not affect the person's entitlement. It will only affect those with high-end homes where the amount of cash left over would put the person's assets (other than the family home) above the current threshold.
We have to draw a line somewhere, and sorry to upset those who have sentimental feelings about their homes. When people get divorced, they sometimes have to sell their homes. When business owners go broke, they sometimes have to sell their homes. When renters don't pay their rent, they get evicted. Time to move on, I say.
On the other hand, I don't consider the income stream from an allocated pension as being "income" if it is part of the capital. I see it as being the asset itself. The interest or dividends derived from the amount invested is "Income'.
In my way of thinking, somehow the govt implements a cut-off mark for the value of the family home. Below a certain value it does not affect the pension. Above a certain amount, it affects the pension. In a lot of cases this cash in hand may well be low enough that it does not affect the person's entitlement. It will only affect those with high-end homes where the amount of cash left over would put the person's assets (other than the family home) above the current threshold.
We have to draw a line somewhere, and sorry to upset those who have sentimental feelings about their homes. When people get divorced, they sometimes have to sell their homes. When business owners go broke, they sometimes have to sell their homes. When renters don't pay their rent, they get evicted. Time to move on, I say.
On the other hand, I don't consider the income stream from an allocated pension as being "income" if it is part of the capital. I see it as being the asset itself. The interest or dividends derived from the amount invested is "Income'.
Or like many they can move into a caravan park
http://www.canberratimes.com.au/bus...australias-caravan-parks-20141010-1147ul.html
http://www.canberratimes.com.au/bus...australias-caravan-parks-20141010-1147ul.html
These oldies are not stupid. You don't live to 75 in Sydney without figuring out the city is obsessed with house prices.
They know exactly how much their homes are worth and exactly how to work the system to get the maximum pension possible.
I used to have sympathy, but sorry, don't anymore - we cannot afford to fund people who can afford to look after themselves.
They know exactly how much their homes are worth and exactly how to work the system to get the maximum pension possible.
I used to have sympathy, but sorry, don't anymore - we cannot afford to fund people who can afford to look after themselves.
This may be naivety, but surely these people who have obviously worked hard enough through their lives to buy and pay off their homes are the last people the government should be scrimping on? Sure the pension has to be cut back at some point but wouldn't you think there are other areas to focus on, say knuckling down on benefits cheats and implement more work for the dole schemes etc.
Has sufficient time passed since compulsory super was introduced for people who started work then to be retiring?
Has sufficient time passed since compulsory super was introduced for people who started work then to be retiring?
Means testing of the Age Pension is as old as the Pension itself. In fact there has never been a time in Australia without means testing. There was a brief period when Whitlam eliminated it for those over age 75 and later 70, but that didn't last long.
Interesting that for the first half of last century, less than 1/3 of the aged population qualified for a pension.
"The years 1946 to 1980 saw a steady growth in the proportion of the aged population who received age pensions as the means test was liberalised. Table 2 shows that around 32 per cent of the aged population received an age pension up until World War II. Means test changes over the following decades saw that proportion rise to a high of 77 per cent in the late seventies. By the late eighties it had dropped back to around 60 per cent due to a major policy shift."
http://www.aph.gov.au/About_Parliam...ary_Library/Publications_Archive/online/Aged3
I'm 30 now and don't really expect there to be such thing as an aged pension 30 years from now... well, certainly not in its current form. Perhaps more of a 'supplement' payment (terminology is just as important - New Start, for example) to tie one over. I guess that's why they've increased the superannuation percentage recently and probably will continue to do so.
Regardless... thank you, Somersoft, for helping me to brighten my future and hopefully be one less person dependent on it
Regardless... thank you, Somersoft, for helping me to brighten my future and hopefully be one less person dependent on it
You'll see a lot of advisors (even the gov) pushing older works, say 50+ to put as little into mortgage and maximum into super. At 65 they can just pull it out of super and put it into there mortgage where it no longer effects the pension, that's my understanding anyway. This is completely legal but surely then the value of the property should be taken into account of the pension.
Can you not also redraw that loan without effecting the pension? If it was cash in the bank it would effect your pension.
I'm a fan of the pension but ppors are a loophole at the moment. Pretty hard case for any gov to prosecute though
Can you not also redraw that loan without effecting the pension? If it was cash in the bank it would effect your pension.
I'm a fan of the pension but ppors are a loophole at the moment. Pretty hard case for any gov to prosecute though
No.
I don't recall what year it came into being, but my hubby had been in the workforce for many years before it came in. He left school, year 10, in 1972.
I have had Super for 16 years and will not be eligible to claim a pension until I turn 68, (I think) which is still quite a while off
LOL. Most people that started their working lives with super aren't going to have enough to live on without some form of support, I guarantee you that. Let alone people that have only had it for about 20 years.
Not for a while, compulsory super started in the early 1990's but the rate was a lot lower back then, so will take a long time until those retiring will have worked their entire life with super.
An interesting article about the beginning of Age Pensions appeared on 1st Aug 1901
http://trove.nla.gov.au/ndp/del/article/124104767?searchTerm="age pension"&searchLimits=sortby=dateAsc|||l-decade=190|||l-category=Article|||l-year=1901|||l-month=8|||l-word=100+-+1000+Words
The writer states " will encourage a growth of the pauper spirit in the community".
http://trove.nla.gov.au/ndp/del/article/124104767?searchTerm="age pension"&searchLimits=sortby=dateAsc|||l-decade=190|||l-category=Article|||l-year=1901|||l-month=8|||l-word=100+-+1000+Words
The writer states " will encourage a growth of the pauper spirit in the community".
Thanks for all of the replies, as I started my working life in 2001 I wasn't sure when compulsory super came in. I know I don't factor super into my retirement planning as I believe by the time I reach that age the goalposts will have moved so much it will be drip fed to me, but I do feel for honest, hard working folks who may not have been fortunate enough to have well paid jobs, who raised families and just got by on average wages but still managed to do the right thing and go to work every day to pay off their homes. These people rightly or wrongly believed they would get a paid pension upon retirement and be able to see out their days in the homes they worked so long for and to take that away from them would be an absolute disgrace IMO.
I understand no one should be standing there with their hand out, but I just think there are other areas/generations/welfare recipients the government could focus on rather than those who built this country.
I understand no one should be standing there with their hand out, but I just think there are other areas/generations/welfare recipients the government could focus on rather than those who built this country.
many self funded retirees are happy to be removed from the govt welfare system. not all expect the govt to fund their lifestyle despite in many cases having paid/paying tax all their income earning lives.
on the other hand for many it is a given for them to be supported. lets hope the money lasts to fund their expectations.
financial independence is a goal that many are not interested in despite having the ability to achieve this. others will always need welfare because of their circumstances.
perhaps there is comfort in dependency for some? some have no choice.
on the other hand for many it is a given for them to be supported. lets hope the money lasts to fund their expectations.
financial independence is a goal that many are not interested in despite having the ability to achieve this. others will always need welfare because of their circumstances.
perhaps there is comfort in dependency for some? some have no choice.
I'm almost laughing as I type this but perhaps the government could teach more about money management and investing in schools to try and promote financial independence, show the next generations that anyone can live a full life without reliance on the system.
I know when I was at school I learnt very little about money management and my family unfortunately were not the most investment savvy to be able to teach me at home, which I imagine happens in many households.
I know when I was at school I learnt very little about money management and my family unfortunately were not the most investment savvy to be able to teach me at home, which I imagine happens in many households.
good idea but many are unteachable? for many reasons. plus knowledge is 1 thing application another.
many will need welfare from cradle to the grave. some because they have no option for others they may believe it is their right to be supported.
some will always believe education, health etc needs to be free for all. not sure if all understand how these things are funded?
meanwhile life goes on.
many will need welfare from cradle to the grave. some because they have no option for others they may believe it is their right to be supported.
some will always believe education, health etc needs to be free for all. not sure if all understand how these things are funded?
meanwhile life goes on.
