hollykimalan

Are pensioners generally better off in Australia compared to the UK?

I am not asking about being better off in merely financial terms.
Being nearly 40 I am now looking at these things more seriously.
HKA
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bcworld

http://www.oecd.org/dataoecd/8/61/43071222.pdf

More than one in four Australian seniors live in poverty on international
measures. This is the fourth highest old-age poverty rate in the OECD
countries and more than double the OECD average. The OECD welcomes the
government’s increase in the age pension to address this problem.

Old-age poverty
Nearly 27% of over 65s in Australia have incomes below the OECD poverty threshold (half of median household income). Only Ireland, Korea and Mexico of the 30 OECD countries have higher old-age poverty rates.

quoll

Just an impression and comparing my parents with us - no.

There is a social security benefit for people of pension age but the expectation is that people will provide for their own retirement and you do have to be quite poor to access the govt benefits. With the current chaos in the super market many people who thought they had retired now cannot afford to live and are forced back into the workplace if they can find a job. Also you have to pay for things like prescriptions unless you fall into the social security category. They still encourage you to have private health as well which is a huge cost especially if you joined a scheme late otherwise the waiting lists for elective surgery is a joke. Even with a seniors card (not means tested generally available but not for health related issues) you still have to pay something for transport although there are discounts. Getting into a nursing home is hard and bonds are usually of the order of $3k so you have to sell your home if you need a nursing home - which can be tricky if there is one able bodied partner.

I dont think it is that great her for the olds really.

WillBlack

What is not entirely clear is what is being compared.

The relatively low government old age pension in Aus and tax concessions on superannuation contributions, earnings and capital gains is intended to be an inducement for people to provide their own private pensions.

It appears that the report might not include the 9% of income Aus mandatory superannuation contributions. It certainly does not include additional non-mandatory superannuation contributions.

It appears to be tainted by a Eurocentric view of pensions.

WillBlack

I think a typo prevented you from writing:
bonds are usually of the order of $300k
to get into a (low to medium care) hostel. Those who are assessed as not being able to afford the bond are accepted with the Commonwealth paying the accepting hostel. Acceptance regardless of bond is dependant on assessed need.

Only those assessed as needing high care are admitted to a nursing home and costs are mostly bourne by the Commonwealth.

jad n rich

Pension in OZ is means tested, many people dont get a pension. As far as I was aware even the pensioner discount card will now be means tested.

Poms in OZ also need to be aware if you spend your life working in OZ then return to UK you DONT get the aussie pension. That little point seems to be something most dont know and if youve not paid UK NI contrbutions I assume you dont get UK pension either.

WillBlack

Current International Social Security Agreements

Social Security Agreement between Australia and the United Kingdom of Great Britain and Northern Ireland Note: This Agreement was terminated from 1 March 2001

ABCDiamond

But they do get the Australian pension / Super that they have accumulated via the compulsory employer funded super scheme here.

When comparing to the UK, the aged pension in the UK is probably covered by the employers share of the Nat Insurance contribution.

Here in Australia it is covered by the employer paying the 9% contribution to your private super/pension policy.

The difference is in the UK, the employer pays the government, and the government share it out between everyone. Whilst in Australia, the employer pays it directly to a personal super fund of your choice.

The losers in Australia are those that do not work, and are unable to share in the contributions of those that do work, other than by getting the rock bottom basic state benefit.

ABCDiamond

It is.

A single person over pension age, whose income exceeds $41,119 per year is not entitled to any state pension benefits, or the Pensioner Concession Card.

The threshold for a couple is $68,705 family income.

jad n rich

I guess our kids will accumulate enough years of employer super to make this significant $$ wise. However most people on this forum would be 30/40/50 and no way is 10 or so years of employer contributions going to provide much of a pension.

Plus superannuation is linked to the share market, as I pointed out when it was making 15% a year and people were raving about it, that it also goes backwards, the australian this week claimed the avg fund went back 17% this year. Sounds high mine only went back 8%

ABCDiamond

You did say: Those people who have done the majority in the UK, will have to add what they get from the Australian Super to their UK pension.

And of course wait for the stockmarket to pick up again before retiring...

Unless of course their super is not linked to the stockmarket, as some peoples are not.

hollykimalan

Thanks for the quick replys guys!
HKA
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twizzle

Thanks for clarifying that, nicely summarised. I hadn't quite realised the differences, and this helps to make it clearer

quoll

You are perfectly correct $300k is what I meant - I thought it looked odd!

Petals

We are pensioners and it depends how you arrange your finances whether you get a part pension or not. We get a part pension from the UK and we both get part pensions from Centrelink, we did not think we would be eligible for a pension but the way they work it out we do its on assets not on money we have. We have a large allocated pension and the income we take each year is tax free. We have full pension cards so we get cheap prescriptions,we get cheap travel, cheap registration,l cheap power, phone and gas. Rates are reduced.

We feel we are very very ok thank you very much.

If you buy property to lease and fund retirement its not effective at all as they take the asset into account the same as caravans, holiday homes these are all a no no if you want to be well off in retirement and keep your super.

My husband was on a multiplier defined benefit so did very well in the super department when he retired and we already knew we were going to put a large part of it into an allocated pension. We still get to elect how the money is invested, can withdraw at any time we like but its tax effective.