In this guide
Retirement income planning generally revolves around the size of your super balance and whether you will be eligible for a full or part Age Pension. Simple! Except when it’s not.
Your retirement income and spending strategy will be driven by not just your super balance, but also by your savings outside super, your life expectancy and how long your savings need to last.
And given that most Australian retirees still receive a full or part Age Pension, your total retirement income will also be driven by how the Age Pension assets test affects your eligibility for the pension.
The Age Pension and the taper rate
The Age Pension is means tested and uses income and assets tests to determine the level of pension an individual or couple is entitled to receive. The test that provides the lowest amount of Age Pension is the one that is used.
Broadly, it works as follows. If your income or assets exceed the relevant thresholds, your Age Pension begins to reduce:
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