welfare vs frugal

[weg]

My home was 3 hours from uni so I needed to live out of home.

Do you use negative gearing? Family allowance? Did you take the pointless payment of $900

If yes to any of these then you are in no position to lecture. 2 years of austudy to assist in say to day living was a huge benefit which helped me achieve my goals. I have not taken a cent since then as I started working in my profession - full time whilst studying full time as well.

Yes, I could have achieved it without austudy but it took a lot of the pressure off. And it meant I could spend enough time studying to get the results I needed to get ahead. 2 years our of uni and I was earning very good money and have been paying my fair share in tax ever since.

No to 2 out of the 3, but I'd be happy to see all of those go if they got redirected to something useful... like to those that really NEED it. I didn't. (sense the different attitude here )

I think you've completely missed the point in what I've been trying to say .

It's not so much the recieving of welfare I have an issue with but the attitude of some.

#1 many people confuse REAL need with what they think they need, and think they're really hard done by because they believe everyone but them is born with a silver spoon in their mouth (when in actual fact only a small % of the population are - most just work hard but don't complain how difficult it is).

You come across as very hard done by.

#2 much of the welfare given takes incentive to help yourself away - many don't work at all, or work very little because it does get cut/reduced. I think they should work when they're perfectly able to... as you, and many others that don't get any assistance did/do.

which leads me to the last thing I keep asking

#3 how come you got Austudy working almost fulltime hours, even if you did live away from home? Perhaps, if you had a family/children as dependants?? That is very generous of the Australian government in my opinion.

If Austudy made such a difference and was what determined whether you continued or abandoning study, then it must have been more than a small amount.

 

[Ideo]

When did I say need?

I said it was of benefit. And fromemory it was around $120 a fortnight.

 

[cimbom]

Are you saying you think you should be even more entitled to government assistance because you choose to give your income to others .

If not what is the reason for mentioning this? If those families are financially challanged you would think they're already recieving assistance?

I personally haven't met anyone, to my knowledge (excluding Asians I've known - who btw weren't studying at the time), that needed to support their families while studying fulltime, and i've studied, am exposed to others that study, and work with people who are frequently studying.

Is that your reason for having worked almost fulltime and finding it difficult to survive, as well?

No, I'm not. It was just an example of a position that I could imagine someone being in but still be "struggling".

Yes, I got benefits for the few years that I studied and I'm grateful for that. Should I hang my head in shame? It was a short period of time and I was determined that once I graduated, I would not continue to receive it. I think I have already paid it all back in taxes just being out of uni for a few years and working.

It is very difficult to come from a family where very few people have a professional career or even any proper qualifications and you want to do something different/better.

I am happy to pay a small amount of money to encourage people to focus on their uni studies and develop themselves professionally (by being able to do volunteer work, get relevant experience, etc). A lot of countries give much more than Australia does. It is not something that concerns me, as a taxpayer, at all.

 

[BayView]

In relationship to this thread, some of the wealthiest people I know also max out on their government welfare. On Sydney's north shore, there are certainly many pensioners living in mansions and driving mercs. These are probably the most skilled investors / wealth accumulators around.

I'd doubt that very much; I hear the same thing everywhere I've ever lived - the old bloke who appears to be a bum, but owns half the suburb according to locals.

And so on.

Simply an urban myth...

If you have an aged pension of any sort - you aint rich.

 

[china]

Simply an urban myth...

If you have an aged pension of any sort - you aint rich.

Definitely an urban myth.

Many pensioners have structured their affairs very well so as to allow living in a million dollar plus house and driving a merc. This is very prevalent around many northern sydney suburbs wherein the median values of homes in many suburbs is around 1.3m. These homes have often been held for over 20 years, purchased at very low cost previously. Whilst own home is not counted in the asset test for aged pension, it is considered as part of one's net worth and wealth. You are allowed as a couple to have almost 800k in assets besides own home to qualify for a part aged pension. Combined with own home, e.g. 1.3m, you are looking at 2.1 mil net worth/ wealth which puts you in the top 20% of net wealth in Australia but still qualify for a part aged pension. The income for these pensioners is often supplemented by "gifts" from children - gifts of up to 10k per year are exempt from income test.

Getting something for nothing / welfare is very attractive to this population. In fact, it is seen as a smart financial move and part of the philosophy of living frugally, off the government. Furthermore, the real benefits of the aged pension is not really the actual sum of money obtained but the entitlements in pharmaceuticals, transport costs and council rates discounts, etc.

http://www.telegraph.co.uk/news/wor...-to-pensioners-hiding-cash-under-the-bed.html

 

[wylie]

Many pensioners have structured their affairs very well so as to allow living in a million dollar plus house and driving a merc. This is very prevalent around many northern sydney suburbs wherein the median values of homes in many suburbs is around 1.3m. These homes have often been held for over 20 years, purchased at very low cost previously. Whilst own home is not counted in the asset test for aged pension, it is considered as part of one's net worth and wealth. You are allowed as a couple to have almost 800k in assets besides own home to qualify for a part aged pension. Combined with own home, e.g. 1.3m, you are looking at 2.1 mil net worth/ wealth which puts you in the top 20% of net wealth in Australia but still qualify for a part aged pension. The income for these pensioners is often supplemented by "gifts" from children - gifts of up to 10k per year are exempt from income test.

So a couple sitting in a valuable house could have $800K in a term deposit to fund their living arrangements. Is that $800K correct? If so, then good on them if they qualify for a small pension because with such a valuable house, they will probably need it. I guess the rates, insurance and maintenance for such a place would eat up a fair portion of the income the $800K is generating.

Getting something for nothing / welfare is very attractive to this population. In fact, it is seen as a smart financial move and part of the philosophy of living frugally, off the government. Furthermore, the real benefits of the aged pension is not really the actual sum of money obtained but the entitlements in pharmaceuticals, transport costs and council rates discounts, etc.

I would not agree that "the real benefit of the aged pension" is the entitlements, transport costs and council rates discount but I agree that it is a nice benefit to be able to get the entitlements in pharmaceuticals, especially as people age. My parents were not eligible for any pension at all, but were able to somehow have a seniors card. That saved them thousands on their medications. Their friends who had never planned for their retirement and were on the pension got all their medications for free, or close to, so this was the one thing that was "given" to my parents who had paid more taxes than most, provided housing for many the government couldn't or wouldn't, and in return, they were penalised financially until their last day on earth.

Even in the nursing home, we paid $500K bond and $750 per week for my father, where the pensioner in the next bed paid nothing but the major portion of their pension (which isn't needed once you get to a nursing home anyway).

If you live in a lovely old mansion, even if you have $800K invested and are relying on your free train trip once a year and cheap bus fares, reduced council rates and gifts from your children, would you call that "rich"?

I wouldn't.

 

[wylie]

Maybe not rich, but not a bad lifestyle subsidised by the government. According to many posters, you can live reasonably well on 50k a year.

So if you are living in a mansion, have income from 800k of investments and the government not only gives you 30k a year in pension but transport, pharmaceutical and various other discounts plus 10k a year from children - coming to essentially a government funded 50k "living allowance package" - and free / subsidised access to nursing home - this is not a bad lifestyle for the pensioned retiree. The key to this is how to make sure that you do not have more than 800k of assets outside your own home when you reach pension/welfare qualifying age. If you have co-operative kids, this is not usually a problem.

If you have $800K invested I'm pretty confident that the government is NOT going to hand you a full pension. I think your figures are wrong.

You can give properties to your kids but then you rely on their goodwill in looking after you and there is a five year time when anything given will still be considered "yours".

If someone is so sneaky as to arrange things in this way, I'd assume the kids might also be of a similar nature, so look out with that one.

Seriously, if you have to be so cunning to arrange things like this, why not put that brainpower to better use?

 

[china]

If you have $800K invested I'm pretty confident that the government is NOT going to hand you a full pension. I think your figures are wrong.

No you get a part pension, but the full ancilliary benefits.

http://www.humanservices.gov.au/customer/enablers/assets

Until, I looked into these figures, I too was amazed that you could qualify for goverment welfare with 800k outside your own home, regardless of the value of the PPOR.

On Sydney's north shore, there are many such pensioners in 1.5 mil + houses on such arrangements.

 

[china]

If you have $800K invested I'm pretty confident that the government is NOT going to hand you a full pension. I think your figures are wrong.

You can give properties to your kids but then you rely on their goodwill in looking after you and there is a five year time when anything given will still be considered "yours".

If someone is so sneaky as to arrange things in this way, I'd assume the kids might also be of a similar nature, so look out with that one.

Seriously, if you have to be so cunning to arrange things like this, why not put that brainpower to better use?

Sure, so many "pensioners" have organised to "give away" assets to children or trusted others five years before pension qualifying age.

Hopefully, your children will support you as you have supported them. I accept that they can take all your assets that you have given them and not "gift" you in return.

So why do so many "pensioners" do this? There is a "gimme" or welfare mentality in this country. A sense of entitlement and the feeling of satisfaction in getting something for nothing that is so intrinsically Australian. Or you could call it planning for a financially secure retirement. And usually, "pensioners" living in a 1.5 mil home with 800k investible assets would usually be more financially savvy than most, probably having been involved in their finances for most of their working life.

 

[wylie]

Sure, so many "pensioners" have organised to "give away" assets to children or trusted others five years before pension qualifying age.

Hopefully, your children will support you as you have supported them. I accept that they can take all your assets that you have given them and not "gift" you in return.

So why do so many "pensioners" do this? There is a "gimme" or welfare mentality in this country. A sense of entitlement and the feeling of satisfaction in getting something for nothing that is so intrinsically Australian.

I'd think it is not "so many" but very few (as a percentage of the total) who actually do this.

Your last paragraph made me laugh. Here are YOU, working out how to weasel a part pension by gifting and manipulating things and then you ask why this is so. You are singing the praises of such actions but wondering why people do it.

It would be good to see the figures on how many people are on the edge of getting a part pension. I know my MIL has her own house, has income from $200K worth of shares, and doesn't get a full pension.

 

[Shaneelastic]

Sure, so many "pensioners" have organised to "give away" assets to children or trusted others five years before pension qualifying age.

Hopefully, your children will support you as you have supported them. I accept that they can take all your assets that you have given them and not "gift" you in return.

So why do so many "pensioners" do this? There is a "gimme" or welfare mentality in this country. A sense of entitlement and the feeling of satisfaction in getting something for nothing that is so intrinsically Australian. Or you could call it planning for a financially secure retirement. And usually, "pensioners" living in a 1.5 mil home with 800k investible assets would usually be more financially savvy than most, probably having been involved in their finances for most of their working life.

I agree that this happens a lot

 

[china]

I'd think it is not "so many" but very few (as a percentage of the total) who actually do this.

Your last paragraph made me laugh. Here are YOU, working out how to weasel a part pension by gifting and manipulating things and then you ask why this is so. You are singing the praises of such actions but wondering why people do it.

It would be good to see the figures on how many people are on the edge of getting a part pension. I know my MIL has her own house, has income from $200K worth of shares, and doesn't get a full pension.

Depends on which part of Australia you live in. In parts of Sydney e.g. North Shore, where there has been strong rises in family house values over the past few decades, you will find "many" in the local population of pensioners who obtain the part pension and still live in mansion equipped with an older mercedes.

I am ambivalent as to whether to admire the actions of such people who are obviously very adept at maximising their welfare handouts or to decry their actions. Cannot decide at this stage.

 

[china]

It would be good to see the figures on how many people are on the edge of getting a part pension. I know my MIL has her own house, has income from $200K worth of shares, and doesn't get a full pension.

She would qualify for a part aged pension will full ancillary benefits. She will find it much cheaper to fund nursing home care than a fully self funded retiree. As you pointed out earlier, if you do not access any form of government pension, you are liable for massive costs when trying to get nursing home care.

So in Australia, it may be a myth to invest /save for a fully self funded retirement when it may be better to position yourself for maximal welfare handouts. I think that if you are going the self funded path, you should aim for many millions in a nest egg for a truly luxurious retirement. Otherwise, it may be best to study welfare qualifying rules very carefully and live well on government.

 

[Ed Barton]

So if you are living in a mansion, have income from 800k of investments and the government not only gives you 30k a year in pension

Many elders houses are not mansions, merely in an area that had large price appreciation. Should we force grandma to sell her home of 40 years and move to the outer burbs to fund her retirement?

A couple with 800k of investments will not receive a 30k pa pension. Under the asset test they will receive 7.4k pa in pension.

plus 10k a year from children - coming to essentially a government funded 50k "living allowance package" -

No where near. See above.

The key to this is how to make sure that you do not have more than 800k of assets outside your own home when you reach pension/welfare qualifying age. If you have co-operative kids, this is not usually a problem.

I'm from a culture of kids 'cooperation'. Spouses are often not!!

 

[Angel]

There are elderly self-funded retirees who may call themselves 'pensioners" but they are receiving an allocated pension from their investment fund. This is not a govt pension, China.

I know of elderly retirees who were living comfortably off their funds before the GFC but with lower interest rates these days they are eligible for a part pension from the govt. It is a small subsidy, not their total income.

 

[china]

Many elders houses are not mansions, merely in an area that had large price appreciation. Should we force grandma to sell her home of 40 years and move to the outer burbs to fund her retirement?

A couple with 800k of investments will not receive a 30k pa pension. Under the asset test they will receive 7.4k pa in pension.

Grandma's house on the north shore of sydney will be worth three times more than the mcmansions of sydney's west which may house a young working family consisting of a plumber, his wife and two kids. Yet grandma will receive the government pension whilst plumber needs to keep plumbing. Furthermore, the plumber may never reach the net worth of grandma's house in his lifetime.

Is this a good way to distribute Australian welfare?

 

[china]

There are elderly self-funded retirees who may call themselves 'pensioners" but they are receiving an allocated pension from their investment fund. This is not a govt pension, China.

I know of elderly retirees who were living comfortably off their funds before the GFC but with lower interest rates these days they are eligible for a part pension from the govt. It is a small subsidy, not their total income.

I refer to many government pensioners whose total net worth may be in excess of 2 mil.

 

[china]

GP's are now required to do GP registrar training after their internship to be able to work as a GP - don't know how many years this is, but I do know the pay is not great as a registrar.

Two quick years at about 100-150k per year, aged 27.

 

[Angel]

Grandma's house on the north shore of sydney will be worth three times more than the mcmansions of sydney's west which may house a young working family consisting of a plumber, his wife and two kids. Yet grandma will receive the government pension whilst plumber needs to keep plumbing. Furthermore, the plumber may never reach the net worth of grandma's house in his lifetime.

Is this a good way to distribute Australian welfare?

Grandma's house in Brighton is worth more like $1.6 million, China.

Plumbers get six figure incomes. They can take care of themselves.

Grandma can take in an Asian Student boarder.

Are we happy now?

 

[BayView]

Definitely an urban myth.

Many pensioners have structured their affairs very well so as to allow living in a million dollar plus house and driving a merc. This is very prevalent around many northern sydney suburbs wherein the median values of homes in many suburbs is around 1.3m.

Dude, you are in LALA land.

Every single post of yours is a Sydney based viewpoint, and I'd wager a small part of it as well as your focus for the barometer of how folk actually live...it is nothing like what you reckon for the most part.

Yes, there are small percentages of folk in Aus living the way you imagine - but it's the minority.

The majority - the MAJORITY - of pensioners in Aus are basically down and out, living a life on the scrounge, and a life of less.

They can't go anywhere, drive cheaper end and mostly older cars, shop low-end everything, watch every dollar and cent.

Some are locked in a house that is worth a bit, but the Council rates kill most of those folk and they have to down-size so they can live.

They are not living in $2 mill mansions while also putting out their hand down at Centrelink for a bit of pin money.