The Age Pension is a vital source of income for many Australians in retirement, providing regular payments to help with living costs. Knowing the ins and outs of how it works can make a real difference to your financial wellbeing.

Who is Eligible and How Much You Can Receive?

To get the Age Pension, you need to be 67 or older and meet certain residency requirements. The amount you get depends on two different checks: an income test and an assets test. The government uses whichever of these two tests results in a lower pension amount.

As of July 2025, the highest possible fortnightly payments are approximately:

• For a single person: $1,149.00 (around $29,874 a year)

• For a couple (combined): $1,732.20 (around $45,037 a year)

It’s good to know that these amounts are indexed regularly, meaning they are adjusted to keep up with inflation. Assuming an average inflation rate of 2.5% in the future, the total amount received over a long retirement can be quite substantial. For example, if a single person received the full pension from age 67 and lived to 90, their accumulated pension payments would be over $800,000. For a couple, the combined total would be even more impressive, reaching over $1.2 million in accumulated payments over the same period.

Other Government Benefits

Getting the Age Pension can also open the door to other government support. You might be eligible for:

• Rent Assistance: If you rent your home and pay over a certain amount, you could receive an extra fortnightly payment to help with those costs.

• Commonwealth Seniors Health Card (CSHC): This card gives you access to cheaper healthcare and other discounts. It’s a great option for retirees who might not be eligible for the Age Pension due to their assets but still have a low income, as it has a different income test and no assets test.

Making the Most of Your Age Pension

The rules around the Age Pension can be quite specific, particularly regarding your assets. For a single homeowner to get the full pension, your assets (not including your home) must be below $321,500. For a couple, the combined limit is $481,500.

Proper planning is key to making the most of your pension. Here are a few things to think about:

• Gifting Rules: There are specific rules about giving money or assets to family. You can generally give away up to $10,000 in a financial year, with a total of $30,000 over a rolling five-year period. Gifting more than this can affect your pension for up to five years.

• The Family Home: Your primary residence is not counted in the assets test. This is a very important part of the rules and can be a key consideration in retirement planning. For some, using other assets to pay off a mortgage or even “upgrade” their home can be a sensible approach.

• Working in Retirement: The Work Bonus scheme allows you to earn a certain amount of income from work without it affecting your pension. This can be a great way to supplement your income without it reducing your payments.

Please note that this information covers just the basics and is general in nature. Understanding how these rules apply to your personal situation can be tricky. For tailored advice on your own circumstances, it’s often a good idea to speak with a financial adviser who can help you plan effectively. Feel free to contact us if you have any questions.