Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 441

Start the year right with the 2022 Retiree Checklist

Nothing stays the same for retirees, especially during a pandemic, with concession cards such as the Pensioner Concession Card and the Commonwealth Seniors Health Card again used to target government support.

This is our list of what retirees need to be aware of in 2022. It is a long list and not everything will apply to your situation.

Managing your risk

1. If you deal with or need a financial adviser, check their credentials using the ASIC Financial Adviser Register.

2. If you manage your own superannuation, it may be a good time to review other ways of managing your savings, understand the difference, and familiarise yourself with the responsibilities of managing your own superannuation

There is a lot of responsibility and administration that may be better organised by a large company that may be offering better and cheaper service than was available when you first decided to manage your super fund yourself.

Apply for the age pension or Commonwealth Seniors Health Card

3. Confusion around how to apply for the Commonwealth Seniors Health Card means many eligible self-funded retirees give up. In addition to the confusion around eligibility, there is confusion around what card holders actually get. In recent years it has become clear that the Government uses the Commonwealth Seniors Health Card to identify self-funded retirees. The income support during the pandemic, and more recently access to Rapid Antigen Tests, shows that having the card can mean more than just help for medical and pharmacy costs. Claiming up to 10 Rapid Antigen Tests will available for holders of a Pension Concession Card (i.e recipients of the age pension), Commonwealth Seniors Health Card, as well as DVA cards. 

4. You are now eligible for the age pension at 66.5 which is a little confusing if this is the year you turn 66. Make a diary note to look closely at age pension application 12 weeks before the actual birthday so you can address any hiccups well in advance of your first payment being due. 

5. As soon as you get your Pensioner Concession Card, start applying for your entitlements, including:

  • Gas rebate
  • Electricity rebate
  • Water rebate
  • Council rate discount
  • Drivers licence and registration concession

6. If you are turning 66.5 this year and you are not eligible for the Centrelink age pension, make sure you know why, so you can get ready to apply if things change.

7. If not eligible for an age pension, perhaps you are eligible for the Commonwealth Seniors Health Card, which is income tested and could save you more than $2,500 on healthcare costs. If you think you were not eligible for the Commonwealth Seniors Health Card, check again. Low income returns on investments and changes in deeming rates mean that your eligibility may have changed.

8. If you have a younger spouse, there may be an opportunity to organise your super to maximise your entitlement to the age pension. See here

Update Centrelink

9. If you are already receiving a part pension, make sure Centrelink is up-to-date with the right data. For part pensioners, a change in assets of $10,000 could mean an extra $780 per year in age pension payments. Check the right value for the car or caravan is in the system, and household contents are realistically valued, not at cost but at sale value. These assets are means tested so it's worth it. Your savings may have changed due to a holiday, renovation or medical emergency. Making contact may increase your pension.

Get MyGov organised

10. The Government is working at a rapid pace to get you to access departments online. If you haven’t arranged a setup online, now is the time. Here are some of the things you can do via MyGov:

  • Easily update income and assets by accessing Centrelink
  • Check your Medicare claims and track your safety net threshold by accessing Medicare
  • Complete your tax at the press of a button (or two) using MyTax
  • Start collecting your health data for easier use via My Health Record

Check on what you are entitled to

11. If you are in NSW, hold a Commonwealth Seniors Health Card, and haven't applied for the Seniors Energy Rebate, you should do so. You need to re-apply for this each financial year (This is not for age pensioners).

12. If you are in NSW, hold a Commonwealth Seniors Health Card or get an age pension, and live in a regional area, apply for this year’s $250 Regional Seniors Travel Card after 18 January for your 2022 Card.

13. Travelling by public transport in NSW? If you want to make the most of government transport help, take a look at the following: Pensioner OPAL Card, Pensioner Travel Vouchers, Country Pensioner Excursion Tickets and Regional Excursion Daily (RED) Tickets. Got all that? Hopefully you have more time to plan now you are retired?  

14. Make sure you keep searching for entitlements, concessions, rebates, programmes or whatever they are called. In my list, I have more than 40 and counting. Policies change, governments try and get re-elected, budgets have announcements - it’s a moving feast. Everything from replacement appliances, fishing licences, pet registration and stamps from all levels of government. Oh yes - in different departments in the different levels of government too. There’s work to do here. We work with our clients to make sure they get all they are entitled to.

15. If you are part of a couple, make sure you are registered for the Medicare safety net as a family or couple. This is something most people set up when they first get married but things can change a lot over time and this is definitely worth having. With access to Concessional Medicare Safety Net thresholds as a holder of a Pensioner Concession Card or the Commonwealth Seniors Health Card, this one is a no-brainer.

Making and adjusting your plans

16. If you are trying to work out how your savings are going to last, try the ASIC Moneysmart Retirement Planner. It's much better than many of the services provided by for-profit companies as it includes age pension eligibility, and works this out over time. 

17. While you are making plans, why not look out how your spending compares to the ASFA Retirement Standard. This is a great tool for checking how your spending in retirement might look if things are going well, and how your spending could look if you had to tighten your belt.

Fine tuning your investing

18. If your investments are hard to track, hard to organise, or you cannot link your investment strategy to your retirement plans, it might be time to consolidate and simplify. There is a link between asset allocation strategies and expected returns. ASIC explains it here.

19. For Australians in later life more likely to invest at the conservative end of the spectrum, the reliability of returns in a diversified portfolio improves. Use these expectations, an understanding of spending, and expectations of Government support to be the basis of long term retirement spending plans. It’s easier than it sounds. A long-term plan should be easy to hang your hat on - with the discipline in making regular reviews to make sure the plans still make sense - and of course with crisis meetings when things unexpectedly change - think medical emergency, aged care, sudden yearning for travel, urgent house upgrades and maintenance, bailing out a child... the list is endless.

20. Environment, social, ethical, responsible - these are all words we are seeing a lot. Aligning your investments with your beliefs is now easier and cheaper than ever before. 

Home Equity Access Scheme (formerly the Pension Loan Scheme)  

21. If you own property and need a top up for your day-to-day living expenses, the Home Equity Access Scheme may be right for you. The interest rate has just been reduced to 3.95%. 

22. If you are eligible for the Centrelink age pension at $0 you can apply for the Home Equity Access Scheme. What this means is that you can apply for a loan even if you are a self-funded retiree. This may suit people with illiquid assets that stop them from getting an age pension, who may be cashflow poor. The Scheme now allows recipients to draw down a lump sum as well as regular payments.

Check the timing of the Budget changes

23. Many of the key changes in the May 2021 Budget have not yet passed legislation but are supposed to come into effect 1 July 2022. Take a closer look if you:

  • Are between 66 and 74, not working, and want to put more money into super
  • Are looking at downsizing and you are 60 or over.

Aged care planning

24. If this is on your radar, start planning. Home Care Packages have waiting times and unique means testing outcomes that should be understood when looking at the wait.

Some final words

25. Low interest rates, unpredictable markets, long lives, uncertain future expenses - this story is the same balancing act, yet different in this age of low interest rates. Putting all the elements together takes work, but is worth it for the peace of mind. Independent advice will help you get this setup in your best interest.

 

Brendan Ryan is a financial adviser and Founder of Later Life Advice. This article is for general information purposes only and does not consider the circumstances of any person.

 

8 Comments
Terence Derome
March 28, 2022

Referencing Paragraph 4. I turned 66years in December 2021. Does that mean that I am not eligible at all this year or does it mean that I'm eligible from 10 June 2022 and I can commence my application 12 weeks prior 10 June 2022.

Mike
February 18, 2022

Regarding item 23 above, budget changes. There were some very good changes that have been passed and not mentioned above. Specifically: the Treasury Laws Amendment (More Flexible Superannuation) Bill 2020. (Assent 22/6/21). This includes retirees aged 65 and 66 who were not previously able to access the bring forward non-concessional contributions cap ($330k) due to their age may do so. This can be a huge opportunity to some retirees.

Dinah
January 20, 2022

Thanks so much for this great and helpful article.

Tom Taylor
January 19, 2022

To me most of the advice revolves around being a pauper with your hat out asking for alms. Why would anyone want any charity from governments who do everything they possibly can so that you qualify for the pension. What? so when you retire and dare to spend more than six weeks overseas they can suspend your pension???? I am 68 and still working because I love what I do.

Dave
January 13, 2022

Before retirement people should consider making their mortgage into one with a redraw facility. Then at retirement you have ready access to extra funds when needed. I retired with 0 on mortgage but kept the loan active to ensure access to funds when needed. It is important to know that once you stop work you no longer have the ability to get a new credit card or bridging loans. We draw $70,000 from super each year but banks and card companies refuse new cards or increased credit
limits that someone working on same income would get without question.

Alex
January 13, 2022

Yes, 10 free RATs, but where are they? What happened to the hundreds of millions paid by governments to the big consulting firms to manage this mess. We blame governments but why does nobody focus on their ineptness in not seeing any of this?

Antony
January 13, 2022

Alex …. it’s not enough we’ve been turned away from PCR tests, if we get one wait 3 days for results now we’re left to hunt and hunt to find a RAT ….. then we have to pay BUT now unless we self report a positive result we will be FINED $1,000. In most cases we’re all trying to do the right thing … been vaccinated, now sitting in self isolation with Covid ….. are they asking us to dob in our neighbour?? How else will they enforce the fine? Really the credibility is starting to be questioned. Australians are a sensible compliant population but pushed too far …..???

Alex
January 13, 2022

Hi Antony, yes, but how many people will not report a positive RAT. There's no way of fining anyone for not reporting it, or are they going to check garbage bins for used tests? While I would self isolate if I had a positive RAT, I sure would not report it and end up on some government data base forever.

 

Leave a Comment:

     

RELATED ARTICLES

Great new ways the Government helps retirees

20 great ways the government helps retirees

Risk in retirement: five strategies for finding the right balance

banner

Most viewed in recent weeks

Lessons when a fund manager of the year is down 25%

Every successful fund manager suffers periods of underperformance, and investors who jump from fund to fund chasing results are likely to do badly. Selecting a manager is a long-term decision but what else?

2022 election survey results: disillusion and disappointment

In almost 1,000 responses, our readers differ in voting intentions versus polling of the general population, but they have little doubt who will win and there is widespread disappointment with our politics.

Now you can earn 5% on bonds but stay with quality

Conservative investors who want the greater capital security of bonds can now lock in 5% but they should stay at the higher end of credit quality. Rises in rates and defaults mean it's not as easy as it looks.

30 ETFs in one ecosystem but is there a favourite?

In the last decade, ETFs have become a mainstay of many portfolios, with broad market access to most asset types, as well as a wide array of sectors and themes. Is there a favourite of a CEO who oversees 30 funds?

Betting markets as election predictors

Believe it or not, betting agencies are in the business of making money, not predicting outcomes. Is there anything we can learn from the current odds on the election results?

Meg on SMSFs – More on future-proofing your fund

Single-member SMSFs face challenges where the eventual beneficiaries (or support team in the event of incapacity) will be the member’s adult children. Even worse, what happens if one or more of the children live overseas?

Latest Updates

Superannuation

'It’s your money' schemes transfer super from young to old

Policy proposals allow young people to access their super for a home bought from older people who put the money back into super. It helps some first buyers into a home earlier but it may push up prices.

Investment strategies

Rising recession risk and what it means for your portfolio

In this environment, safe-haven assets like Government bonds act as a diversifier given the uncorrelated nature to equities during periods of risk-off, while offering a yield above term deposit rates.

Investment strategies

‘Multidiscipline’: the secret of Bezos' and Buffett’s wild success

A key attribute of great investors is the ability to abstract away the specifics of a particular domain, leaving only the important underlying principles upon which great investments can be made.

Superannuation

Keep mandatory super pension drawdowns halved

The Transfer Balance Cap limits the tax concessions available in super pension funds, removing the need for large, compulsory drawdowns. Plus there are no requirements to draw money out of an accumulation fund.

Shares

Confession season is upon us: What’s next for equity markets

Companies tend to pre-position weak results ahead of 30 June, leading to earnings downgrades. The next two months will be critical for investors as a shift from ‘great expectations’ to ‘clear explanations’ gets underway.

Economy

Australia, the Lucky Country again?

We may have been extremely unlucky with the unforgiving weather plaguing the East Coast of Australia this year. However, on the economic front we are by many measures in a strong position relative to the rest of the world.

Exchange traded products

LIC discounts widening with the market sell-off

Discounts on LICs and LITs vary with market conditions, and many prominent managers have seen the value of their assets fall as well as discount widen. There may be opportunities for gains if discounts narrow.

Sponsors

Alliances

© 2022 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. Any general advice or ‘regulated financial advice’ under New Zealand law has been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892) and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. For more information refer to our Financial Services Guide (AU) and Financial Advice Provider Disclosure Statement (NZ). You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.

Website Development by Master Publisher.