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Government benefits and aged care

With the end of  the 2020 financial year approaching, now is an important time to consider options that might be available to you or other members of your family in relation to Government benefits and/or accessing aged care services.

Understanding your entitlements through Centrelink can be confusing, as can the financial implications of aged care living. Our Financial Advisers, Pat Kelly and Jenny Kitching, are here to help you if you have any questions – so feel free to contact us.

When it comes to Government benefits and aged care, the key points to consider include:

  1. Applying for Centrelink or Department of Veterans' Affairs (DVA) benefits – the Government provides a wide range of benefits to assist with meeting day-to-day living expenses for members of the general public, and for veterans and their families. Benefits may include the payment of pensions, allowances, and income support payments like the Family Tax Benefit, and Child Care support. If you need assistance in determining what benefits you may be entitled to, and how to apply for them, please let us know.
  2. Applying for the JobSeeker Payment - asset testing of people applying for the JobSeeker Payment has been waived for six months from 25 March 2020. At the same time, Mutual Obligation requirements have been eased and for couples, the partners' income test has been eased substantially. In addition to these measures the access to JobSeeker has been expanded to include the self-employed and sole traders. If you believe that the change in your income circumstances means that you may be entitled to JobSeeker and would like to test your eligibility, please let us know so that we may be able to assist.
  3. Reviewing assets and income – many Government benefits are means tested. They are subject to an assets and an income test. To ensure you are receiving your correct entitlements, a regular review of the current value of your income and assets is prudent. When valuing assets for assets test purposes, it is the ‘fire-sale’ value that is used – not the insurance or replacement cost.
  4. Gifting – involves giving away something you own for less than its fair value. Limits are placed on the amount that may be gifted each year, and over a five-year period, without it having an adverse effect on the benefits you may be receiving. Before giving away money or property, or even acting as guarantor on a loan, please speak with us.
  5. Reviewing your dependants – Government payments are based on your relationship status – whether you are single, a member or a couple, or a couple separated by illness. Also, the amount of benefit you may be entitled to may increase if you have dependants. Ensuring that Centrelink or the Department of Veterans' Affairs has the correct information about your family structure and relationships will ensure you are receiving your correct entitlements.
  6. Commonwealth Seniors Health Card (CSHC) – this card is available to those who have reached the eligible age for the age pension, but are unable to receive the pension because of the assets or income test. The card provides a range of benefits including access to bulk-billed medical services and subsidised pharmaceuticals. Please note that eligibility for a CSHC is income tested, not assets tested.
  7. Low Income Health Card (LIHC) – if you are a single person with an income of less than $570 per week, or a couple with a combined income of less than $984 per week, you may be entitled to a LIHC. The card is not subject to an assets test. This card provides access to a range of services including bulk-billed medical services and subsidised pharmaceutical items.Importantly, you do not need to receive Government income support benefits to qualify for a LIHC.
  8. Aged Care – with an ageing population it's little wonder that more and more Australians are being touched by the need to arrange aged care services – both in-home and residential accommodation – for themselves or family members. The aged care system is complex, particularly when it comes to understanding the types of services available and the costs involved in accessing services. Whether a family member is receiving an age or service pension, or is a self-funded retiree, we can assist you in working through the financial implications aged care living.

This article outlines some of the options to consider in relation to Government benefits and aged care as we approach the end of the 2020 financial year.

If you have any questions, if you would like us to review any aspect of your or your family’s entitlements, or just check that everything is on track, feel free to contact Pat Kelly or Jenny Kitching at The Peak Partnership to take the next steps.

This information has been provided as general advice. We have not considered your financial circumstances, needs or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication.
Peak Partnership Wealth Design Solutions Pty Ltd ABN 26 711 439 304 is a Corporate Authorised Representative (No 415154) of Professional Investment Services Pty Ltd. AFSL No 234951. ABN 11 074 608 558.

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