Volume 5 Edition 8 Financial Care Services Newsletter

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FINANCIAL CARE SERVICES
Independent aged care, lifestyle and financial advice for seniors
Volume 5 Edition 8 –31 August 2015

Hello

Financial income for DSP and Age Pension Income Test

The amount of DSP or Age Pension that you could be paid by Centrelink is subject to an Income Test and an Assets Test. Centrelink Pension Income Tests use the deemed financial income from your financial assets rather than your actual earnings from financial assets.

As at August 2015, the annual rate of deemed financial income for a Single Pensioner is calculated as 1.75% of the first $48,600 of her financial assets plus 3.25% of any financial assets in excess of $48,600.

The annual rate of deemed income for a Couple at Centrelink, as at August 2015, is calculated as 1.75% of the first $80,600 of their total combined amount of financial assets plus 3.25% of any financial assets in excess of $80,600.

Read more about the Deemed Financial Income Calculation

Before you could calculate your deemed financial income you need to identify your ‘financial assets’.

At Centrelink ‘financial assets’ includes
• All bank accounts, loans, deposits of money and stock exchange listed investments
• Gold bullion and other precious metals
• Overseas financial assets
• Life insurance policies which could be surrendered for a lump sum
• Excess gift amounts; and
• Most superannuation fund accounts

Special conditions determine the assessable income amounts for long term annuity contracts and some superannuation allocated pension income stream accounts.
Did you notice that there is no provision to offset your personal debts against your financial assets?

Read more about Centrelink financial assets

Help is available. Financial Care Services offers a special $99 Short Consultation to illustrate how much Age Pension you would receive based on your personal data.

To prepare for your Age Pension Short Consultation email now for the Financial Care Services Age Pension Data form. You will also receive the Financial Care Services Financial Services Guide including the Financial Care Services Privacy Policy.

Please remember that Centrelink, or DVA, will determine eligibility for and the amounts of any DSP Age or Service Pension based on the regulations in force at the time of your application.

You might be financially challenged if you still have significant debts when you leave the workforce.

At Centrelink your personal debts cannot be offset against your financial assets. For example your $20,000 credit card debt could not be offset against that $30,000 excess gift amount.
You would still be classified as a ‘homeowner’ Pensioner even if you had an outstanding mortgage of $100,000 owing against your home that was valued at $400,000.

Your retirement planning needs to include debt management. Remember, DVA Service Pension and Centrelink income support payments provide for a frugal standard of living with no savings component. Thus you could not expect to set aside part of your Pension for home mortgage repayments as well as covering your most basic living costs.

Problems await retirees with debts including any home mortgage, which could not be cleared with that final payout from your employer.

Alas, we are not all able to determine when we will retire. Some folk are able to continue employment until age 70 years. But many find that their jobs are too physically demanding or become redundant long before Age Pension Age.

Planning for a productive third age could mean rearranging your assets to provide an affordable lifestyle.

Help is available. Financial Care Services works with clients approaching retirement. Together we can look at your big picture for life after full time work.
To prepare for your Retirement Planning Consultation email now for the Financial Care Services Retirement Data form. You will also receive the Financial Care Services Financial Services Guide including the Financial Care Services Privacy Policy. Retirement Planning Consultations are charged at our normal hourly fee rates.

Christine could also assist you with collating your personal data, estimating how much Pension you could expect to receive and completing the Centrelink forms for you to sign. Normal hourly rate consultation fees apply for assistance with personal data collation, completing Centrelink forms and attendance at a Centrelink office with you.

Please remember that Centrelink, or DVA, will determine eligibility for and the amounts of any DSP Age or Service Pension based on the regulations in force at the time of your application.

Financial Care Services is an independent aged care financial advisory service specialising in aged care entrants and retirees with modest financial resources.

Financial Care Services core value in financial advice is to assist with your money plan in the responsible management of your assets to generate the cash flow needed for your lifetime planning.
Christine at Financial Care Services understands both the DVA and Centrelink Pensions systems and the Commonwealth aged care fee arrangements.

To make an appointment for confidential, independent and professional advice about Centrelink, lifestyle or financial issues please contact Christine Hopper or call 03 9808 0338.

____________________________________________________

Christine Hopper

Director
Financial Care Services Pty Ltd
Independent aged care, lifestyle and financial advice for seniors in Melbourne, Victoria, Australia
Australian Financial Services Licence Number
299570 (check this at www.search.asic.gov.au/fsr/flb.html)
Authorised Representative Number
252529 (check this at www.search.asic.gov.au/fsr/far.html)

Telephone – call +61 3 9808 0338
Email – contact info@financialcareservices.com.au
Address – mail or meet at 172 Warrigal Road, Camberwell Victoria 3124
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Disclaimer: The information contained in this newsletter is of a general nature only and does not constitute “financial advice”. You should obtain your own personal financial advice before investing any money or moving in to any retirement village, lifestyle community or aged care facility. Financial Care Services is licensed to provide financial advice to individual clients based on their personal situations.

All eligibility for Commonwealth benefits will be determined by Centrelink or DVA, based on your personal position as documented and the legislation and Regulations in force at that time.