Age Pension estimate (income + assets test).
Fortnightly pension
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Annual
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How Centrelink decides what you actually get
The Age Pension is not a flat payment. Services Australia runs two separate calculations, an income test and an assets test, works out the pension each one allows, and then pays you the lower of the two. That single rule trips up most people who try to estimate their own entitlement, because a couple can pass the income test comfortably and still be cut back hard by the assets test, or the reverse. This tool runs both tests on the figures you enter and tells you which one is binding, which is the number that actually matters when you plan.
The two tests, in the rates the tool uses
For a single homeowner the maximum rate built into this calculator is about $1,144 a fortnight including supplements. Under the income test you keep the full rate up to an income free area of $212 a fortnight, after which the pension reduces by 50 cents for every extra dollar. Under the assets test a single homeowner keeps the full rate up to $321,500 in assessable assets, excluding the family home, after which the pension drops by $3 a fortnight for every $1,000 above that line. For couples the free areas and the maximum combined rate are higher, and the income taper is gentler, reflecting the shared rate. These thresholds move with indexation in March and September, so treat the output as a close estimate rather than a Centrelink letter.
A single homeowner with $450,000 in assets
Consider a single homeowner who has $400 a fortnight of income and $450,000 in assessable assets outside the home. The income test alone would allow roughly $1,050 a fortnight, but the assets test bites harder. Assets are $128,500 over the free area, and at $3 per $1,000 that reduces the pension by $385.50, leaving $758.50 a fortnight. Because that is the lower figure, it is what gets paid, around $19,721 a year.
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The chart contrasts the two test outcomes for this person. The assets bar is shorter, so it sets the payment.
What the tool simplifies, and what to watch
This estimate uses the homeowner thresholds. Non-homeowners get a higher assets free area because they have no exempt home, so a renter with the same assets will usually qualify for more. The calculator also does not apply deeming, the rule that treats your financial assets as earning a set rate of income regardless of what they actually return. In reality Centrelink deems bank accounts, shares and account-based pensions and feeds that deemed figure into the income test, which can change which test binds. If most of your wealth is in financial assets rather than, say, a caravan or a second car, run your deemed income through the income field rather than your literal cash income.
An expert pointer on the assets sweet spot
Because the assets test reduces the pension by $3 a fortnight per $1,000, every $10,000 of assessable assets above the free area costs about $780 of pension a year, an effective return of roughly minus 7.8 percent on that slice. Retirees sitting just above the threshold sometimes do better by spending on home improvements, which are exempt, or prepaying a funeral bond within the allowable limit, than by holding the assessable cash. This is legitimate planning, not avoidance, and a financial adviser registered with Centrelink can model it precisely.
Questions retirees ask
Does my home count toward the assets test?
The home you live in is fully exempt from the assets test for homeowners, no matter its value. That is why a retiree in a $2 million house can still receive a part pension. Selling and renting, however, converts that exempt value into assessable cash, which can wipe out the pension, so downsizing decisions deserve careful modelling.
Can I get a part pension even if I have a lot of super?
Often yes. Super in accumulation is assessable once you reach Age Pension age, and an account-based pension is assessed too, but unless the balance is very large you may still clear the thresholds for a part pension. Even a small part pension is worth claiming because it unlocks the Pensioner Concession Card and its discounts on medicines, rates and utilities.
How often do the rates change?
Maximum payment rates are indexed twice a year, in March and September, and the thresholds adjust periodically too. Use this tool for planning, then confirm the current fortnightly figure through your Centrelink online account before relying on it for a budget.