The retirement plans of people born on or after 1 July 1952 will change beginning next year. From next year, the qualifying age for age pension entitlements will start to increase progressively by six months every two years.
This change has been enacted to deal with the challenges of Australia’s ageing population. As people live longer and healthier lives, the government believes that people can work longer and increase superannuation balances to have a comfortable retirement.
Today, you must be 65 years or older to be eligible for age pension. Beginning 1 July 2017, the qualifying age for people who will receive pension will be 65 years and six months. Every two years, the qualifying age will increase by six months. By 1 July 2023, you need to be 67 years old to qualify for an age pension.
If you were born between 1 July 1952 to 31 December 1953, you qualify for age pension at age 65 years and six months. If you were born between 1 January 1954 to 30 June 1955, you qualify for age pension at age 66 years old. If you were born between 1 July 1955 to 31 December 1956, you qualify for age pension 66 years and six months. If you were born from 1 January 1957 onwards, you will receive age pension by age 67 years.
Though the numbers are relatively easy to follow, its effects take a whole level of worry for upcoming retirees. We understand that the change is made to make the taxpayer-funded age pension sustainable for the years to come and we cannot argue with that. We just have to accept the bitter fact that one cannot rely on pension alone to have a comfortable retirement at a retirement age of their choice.
That is why, more than ever, we have to be serious in preparing other sources of income for retirement.
One is superannuation, then there’s reverse mortgage. A reverse mortgage allows you to effectively access the equity in your home without losing ownership or leaving your family home.
With or without age pension, you deserve a good quality of retirement. A reverse mortgage is an equity release product that is created with retirees like you in mind.
To help you learn more about reverse mortgage, you can download our FREE REVERSE MORTGAGE GUIDE.
Feel free to call Seniors First Finance at 1300 745 745 or post your comments below.
Watch the video below from the Australian Government Department of Social Services.