Volume 8 Edition 9 Financial Care Services Newsletter

Online at Permalink: https://financialcareservices.com.au/newsletters/vol-8-ed-9/

Financial Care Services, the specialist adviser to seniors in transition to new lifestyles

Volume 8 Edition 9 – 29 September 2018

Indexation adjustment at Centrelink yielding an Age Pension increase

Consumer price inflation has been low over the past year. Thus the September 2018 indexation adjustment to Centrelink Pensions is an increase of 1.0% as from 20 September 2018. The Basic Fee for residential aged care has been increased at a similar rate.

An increase of 0.8% has been applied to the Pension Supplement. The Clean Energy Supplements have not been adjusted but remain fixed in dollar terms.

Single person Age Pension rates effective 20 September 2018

The Single person full rate of Age Pension increased to $834.40 per fortnight. The total Single person rate of Pension Supplements including the Clean Energy Supplement, increased to $81.90 per fortnight.

Thus the maximum payment to a full rate Single person Age Pensioner is now $916.30 per fortnight.

But if your other income exceeds $172 per fortnight then the Income Test would reduce your Single rate of Age Pension. The Income Test would exclude you from any Age Pension if your other income exceeded $1,838.80 per fortnight, $47,808 per year.

The Asset Test would exclude a Single homeowner from any Age Pension if her other assets exceeded $536,300. A Single non-homeowner would not be excluded by the Asset Test until her assessable assets exceeded $743,300.

Partnered Age Pension rates effective 20 September 2018

The full rate of Age Pension for a member of a couple living together increased to $629.00 per fortnight together with Pension Supplements of $61.70 per fortnight. Thus the maximum payment to an Age Pensioner member of a couple has increased to $690.70 per fortnight.

The Income Test reduces the payment rate for a partnered Age Pensioner once their total combined income exceeds $304 per fortnight. No Age Pension is payable to a partnered Age Pensioner if the total combined income of the couple exceeds $2,816.00 per fortnight $73,200 per year.

The Asset Test excludes seniors living with a partner once their total combined assets exceed $806,100 in addition to their home or $1,013,000 if they are non-homeowners.

Remember you are responsible for updating Centrelink whenever your income or asset position changes significantly. Centrelink are required to retrieve overpayments of Pensions. Prompt notification of changes and property sales helps keep your payment rates correct.

Commonwealth Seniors Health Card income cut-off levels increased

Seniors who are excluded from the Age Pension might be eligible for the Commonwealth Seniors Health Card, CSHC. Seniors with a CSHC can access PBS prescription medications at the ‘concession’ prices that Pensioners pay.

The CSHC has an income test only. To be eligible for the CSHC a single senior must have an adjusted taxable income of no more than $54,929 per year. The cut-off is $87,884 per year for couples living together. A higher cut-off level of $109,858 applies to couples where at least one member lives in residential aged care.

New CSHC cards are mailed out each September for all ongoing CSHC holders.

But beware Centrelink can write to you cancelling your CSHC if you are deemed to be over the income limit. For example, your adjusted taxable income can be reviewed when you lodge an Income Tax return.
If a one-off capital gain puts you over the limit for keeping your CSHC you might be eligible to reapply based on your projected adjusted taxable income for the next financial year.

Remember that if your Age Pension ceased on account of the January 2017 changes to the Asset Test then you can keep your Commonwealth Seniors Health Card no matter what your income is.

Residential Aged Care Fee adjustments

The Basic Daily Fee for Commonwealth regulated residential aged care is set as 85% of the single rate of Age Pension. Thus the Basic Daily Fee increased by 1% to $50.66 and the Maximum Accommodation Supplement moved up to $56.59 per day.

In cash terms, all aged care residents will pay slightly more for the ‘housekeeping’ component of their aged care costs.

In addition, a senior who entered permanent residential care as a Supported resident could be asked to pay a little more for accommodation if she now has significant assets or income.

The Means Tested Care Fees for permanent residents will be reviewed to take account of the small changes in the threshold amounts. In practice, your daily Means Tested Care Fee could be reduced by a tiny amount if your asset and income position has not changed recently.

The Annual Cap and Lifetime Cap on care fees increased to reflect the indexation increase in Pensions and threshold levels in the means tested care fee calculation.

Read more about the Residential Aged Care Fee adjustments

Help with navigating the Age Pension system

Christine at Financial Care Services understands many of the Centrelink rules about Age Pensions. Christine could help you check your entitlements and estimate your Age Pension.

Contact Christine to arrange a consultation for ‘personal financial factual information’ about your potential Age Pension. Checking your financial eligibility for the Age Pension before you apply for an Age Pension or Commonwealth Seniors Health Card could spare you a rejection letter from Centrelink.

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.

Call Christine at Financial Care Services now on 03 9808 0338 to start thinking through your potential for an Age Pension.

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Financial Care Services your independent adviser

Financial Care Services is an independent advisory service specialising in retirees of modest means and aged care entrants. Our core values include working with clients in claiming DVA and Centrelink entitlements.

The team at Financial Care Services are here to answer your Age Pension questions and guide your understanding of aged care costs. Help with Centrelink challenges is available from Financial Care Services, the specialist adviser to seniors in transition to new lifestyles.

To arrange an appointment for further confidential, independent and professional advice about DVA, Centrelink, lifestyle or aged care issues please contact Christine Hopper 03 9808 0338.

Financial Care Services charges fees based on the work involved in advising you about pensions and aged care fee solutions.
To make an appointment for confidential, independent and professional advice about aged care, retirement lifestyle, granny flat or Age Pension issues please contact Christine Hopper or call +61 3 9808 0338.

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Christine Hopper
Financial Care Services Pty Ltd
Independent aged care, strategic lifestyle and Social Security advice for seniors in Melbourne, Victoria, Australia
Telephone – call +61 3 9808 0338
Email – contact info@financialcareservices.com.au
Address – mail to 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”.
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.