Pensions in Australia
Are State Pensions Available in Australia?
As in the UK, pensions in Australia are paid when people reach a specified age. These are called Age Pensions.
How Much Is the Age Pension Worth?
Age Pensions from the Australian government are worth $14,615 per annum for single people, and $24,414 per annum for couples in the 2008-2009 financial year.
At What Age Are Pensions Paid?
Men are eligible for an Age Pension at the age of 65. Women younger than 65 are usually eligible for a pension. By 2014, men and women will be treated identically and will become eligible for Age Pensions at the age of 65.
In addition to the Age Pension, various other payments - such as allowances for utility bills - may be available for people over 65 years of age.
How Long Do I Need To Live in Australia for To Obtain a Pension?
To qualify for an age pension, you usually need to have lived as a resident or citizen in Australia for at least 10 years.
Are There Any Income Restrictions on the Age Pension?
Australian pensions are income and asset tested.
Asset Test: If, in addition to their home, a single person has assets worth more than $550,500 (couple $873,500), he/she will not receive a government pension.
A single person gets the full pension if his/her assets are worth less than $171,750 (couple $243,500).
A sliding scale operates between these two values so that you lose $1.50 of age pension per fortnight ($39 annually) for every $1,000 of assets above $171,750 (couple $243,500) you have.
Income Test: If a single person's income (not including Age Pension) exceeds $1,557.75 per fortnight ($2,602 couples), he/she will not be entitled to government pension.
Single incomes of less than $138 per fortnight ($240 for couples) qualify for the full pension.
A sliding scale applies between these two values.
Private Pensions in Australia
Superannuation in Australia is funded by employers who are legally obliged to pay 9 percent of each employee's wage into a superannuation fund.
You are entitled to choose the superannuation fund your employer pay the money into.
The Nine Percent Solution
If you are new to Australia, it is important you understand how your employer has structured your superannuation payments. Some employers pay your salary and, separately, pay an additional 9 percent into the fund. Others deduct the 9 percent from your salary. You need to be clear which approach will be followed.