Planning for retirement/topping up UK state pension
 

So, having crossed the horrible 50 threashold recently I finally started thinking about retirement, doing so sooner would've been better but here we are.

The various online calculators tell me my super is on track to provide a reasonable income, surprising as we only arrived 9 years ago, although we're both making max extra contributions.

One thing I did discover is the ability to top-up our UK state pension, I won't qualify for one from Aus, as its means tested but the UK one isn't. I wanted to share this info as it seems an absolute bargain. If you pass the means test I think you can get the Aus stae pension if you've lived here for 10 years, which seems generous (in spirit, not amount).

If my wife and I top up our UK NI to 35 years contributions we'll get a very useful $37k per year from the UK govt, on top of my UK private pension and Aus Super, since I need another 12 years of NI contributions I'll need to pay out $1,300 for each of these 12 years but the increase in UK pension means I'll be in profit after about 3.5 years, just need to live that long!

The above is just my understanding, please do your own due dilligence but sharing it as there is a time limit to do the top up (think you can only go back 6 years).

Re: Planning for retirement/topping up UK state pension
 

Re: Planning for retirement/topping up UK state pension
 

Re: Planning for retirement/topping up UK state pension
 

Wouldn't that increase just come off of your Aus Government Pension when you came back here though? As though it were increased earnings for that given financial year?

Or if you dont qualify for the Aus Government Pension because of assets and income, how do you get around the no Pension Card, for subsidies on things like Prescriptions, car rego, Utility benefits etc?

Re: Planning for retirement/topping up UK state pension
 

My question also.

Basic State Pension is £129.20 per week = £6,718.40 pa.

Re: Planning for retirement/topping up UK state pension
 

It would only come off the Aus Government pension if you qualify for said creature. Many of us don't and never will, because of super, and then because of he UK pension - being entitled to a full UK pension virtually wipes out any eligibility for the Aussie one due to the means testing.
And I'm told that without being eligible for a pension, one cannot be eligible for a concession card.

Re: Planning for retirement/topping up UK state pension
 

We are self-funded retirees. Get no Australian pension and are not likely to.

There is a (highly-prized) card called the Commonwealth Seniors Health Card designed for people who do not get a pension. Gets you subsidised scripts. Still has an income test but it's more generous than the income test used to qualify for the pension in the first place.

Re: Planning for retirement/topping up UK state pension
 

Re: Planning for retirement/topping up UK state pension
 

Yes that Seniors Health Card is apparently the thing to aim for. As for the Assets for pension and Super, A single person would have to have assets (including superannuation) to the tune of 785,000 AUD (excluding ones own home) to negate yourself from an Australian Pension. I'm fairlly sure the Australian government Pension is also higher than the UK government pension, so even if you qualify for a full UK pension you should still receive some Australian pension. Of course it may only be a negligible amount due to the aforementioned assets test.... The thing is people should be aiming for that Seniors card regardless.

The other point is the UK pension is frozen, so eventually most people under the assets test, which is quite generious, would eventually qualify for the Australian Pension.

From what I can gather the UK pension rate for a single is circa 234 AUD per week, Where as the Australian governmention Pension seems to be 450 AUD per week,(It's quoted fornightly at 933 AUD for a single person) so one should be getting topped up to the tune of almost double from the Australian pension?

Actually seems a massive difference to me, with the Australian pension being far more lucrative..... maybe I've got something wrong?

Hhere is the UK state pension....
https://www.gov.uk/state-pension/what-youll-get

Here are the Australian government pension figures. What I take this to mean is, even if you qualify for the full UK pension, you should still get something from the Australian Governement, as long as you have less than 785,000 AUD in Assets. With that seniors card being the golden chalice.

https://www.superguide.com.au/access...-pension-rates

Re: Planning for retirement/topping up UK state pension
 

My mistake with the currency conversion, sorry, its AUD$32k.

GBP168.60*52*2 = GBP 17,534.4 at todays exchange rate = $31,932


https://cimg3.ibsrv.net/gimg/british...18c1e90237.png

Re: Planning for retirement/topping up UK state pension
 

We were both born after 1953 so get the New (not Basic) state pension, the full amount of which is £168.60 per week, see my other post.

Re: Planning for retirement/topping up UK state pension
 

Re: Planning for retirement/topping up UK state pension
 

My take is that if you get to retire and have enough that you don't need a government provided pension, discount card or some other taxpayer-funded bullshit, you've worked, saved and done well in life

Not requiring any assistance is something to be proud of

Re: Planning for retirement/topping up UK state pension
 

Lots of different types of Seniors cards, I've got the Victorian one, which doesn't give me cheaper car rego. The Commonwealth one does, but I dont get that until I turn 66. The Victorian seniors card does equate to a fishing license though, which is a lesser known benefit that comes with it. Half price public transport, and free weekend travel is the main benefit I get from it.


Meantime I'm about to research the difference in Government Pension payments between the UK and Australia, as It's looking more and more like a lot of UK people dont realise they are entitled to a part Australian Pension to top up the UK pension. From what I can tell, the Aus Government pension is circa 150 AUD more weekly than the UK pension and if you are within the assets test limit one automatically qualifies for the Aus Pension. The Aus Assets test starts at 457,000 AUD. before one gets a reduced Australian pension... then reduces by 3 dollars per fortnight in every 1000 dollars over that amount.

That seems a massive difference, I repeat is it correct. ? 150 bucks per week?

Maybe people should be having a appointment with Centerlink, not that I recommend that organisation.

Re: Planning for retirement/topping up UK state pension
 

I haven't really looked at the Aus one as I don't think I'll get it due to the means test, which is absolutely fair enough and if it pans out that way I'm fortunate. It's still a lot of years to go though, in the meantime I'll keep on top of super and other investments.

The UK one may be less but its not means tested so a nice $32k pa top up on the super, hence me saying it seems worth filling in the NI gaps. I think if you get the full amount for both it adds up to about $55k per year as a couple, from age 67, all figures in todays money of course.

Re: Planning for retirement/topping up UK state pension
 

At todays figures your entitled as a couple to 1407 dollars combined per fortnight, (36,800 per annum) with the cut off figure on the assets test where you receive no pension being 860,000 AUD on top of ones house. If you are under that figures you will get some Australian Pension.... or more importantly that seniors card. Interestingly you can also earn 36,000 AUD combined tax free on top of that amount, how that equates to the UK pension is an intersting point.... .hence chat to Centerlink for clarification.


Also it looks like one qualifies for the full Australian aged pension with just 10 years of permanent residency.

I dont understand why people are paying top up figures on the UK pension if it is frozen when living in Australia? I must be missing something.... maybe it's the assets test. Although the assets limits change every year and that frozen amount stays every year so maybe not. That assets test figure for a couple in GBP is 472,000 pounds on top of ones house..... If one doesnt own a house that figure is 590,000 GBP when a couple stops receiving the Aus Pension.

Here are the residency requirements for the Aus Government Pension.

1. You must be an Australian resident and physically present in Australia on the day you submit your claim,
2. You must have lived in Australia for at least 10 years, and
3. Of those 10 years that you've lived in Australia, there should be at least 1 period where you have lived in Australia continuously for 5 years.

A thought occurs, surely for some it has to be worth looking at the benefits of "Upsizing" to a more expensive Australian primary residence as that could bring people in under the assets test, as the house is exempt from the assets test and negate the frozen part of the UK pension. Especially if one is close to those assets tests limits.

Re: Planning for retirement/topping up UK state pension
 

There is also an income test and *hopefully* my super income will be above the means test, also remember your super balance is included in the asset test. Because of this I'm projected to get little/no Aus state pension.

The reason I'm topping up my UK pension is I will be in profit in under 4 years, i.e. cost to top up is made up by increased payments and pays it off quickly.

Re: Planning for retirement/topping up UK state pension
 

The thing to do apparently is to come in as close to the assets test limit as possible..... so say 750K worth of super combined the rest in assets and just under that 860K figure. Reason being that Seniors Health Card is worth a lot more than people realise. It's not so much the Aus Pension thats valuable, it's the lifestyle at that cusp of the end of the assets test that one gets. To be properly self funded and have no inclination to worry about the means test one would need at least 1.5 million in assets as far as I'm concerned, including super that is. If your under that, then people should look at trying to arrange themselves finding a way to qualify for the Aus Pension at the top end of the scale.

Reason I say 1.5 Million is the 75K in income one should earn from the guaranteed 5pct interest (Challenger accounts etc). Which is about the same income one would get at the higher end of the 860K assets limit scale, with the 10 pct minimum draw down.plus the pension and other benefits one gets. It's a lot more complicated than it looks and people really need to talk to experts in the feild. It gets even more complicated if one factors in potential downsizing as the super balance diminishes.

Everyone's circumstance is different, mine is complicated by the fact that my wife although only 30 months younger than me, doesnt reach the Aus Pension age until at least 50 months after me.

Hence I've got to shift super around into a spouse account, which means I get more Aus Pension.... .Then she can only earn 36K per annum during that period, between my Pensionable age and hers..... Although our joint income will be around the 100K mark take home, and that includes getting some Australian Government Pension.




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Re: Planning for retirement/topping up UK state pension
 

Curious where you get those asset figures from? This suggests only $394.5k for a couple.

https://www.humanservices.gov.au/ind...setstestlimits

Re: Planning for retirement/topping up UK state pension
 

Anyone with any intention of going home should be topping up the UK one - much cheaper to do from over here

Re: Planning for retirement/topping up UK state pension
 

$394.5k is the total amount of assets you can have before the Age Pension starts reducing.
$863.5k is the total amount of assets you can have before the Age Pension cuts out completely.

If your assets total is between those amounts you can get a part pension (assuming you pass the income test as well, of course). People on part pensions still get the Concession Card which is worth having.

Re: Planning for retirement/topping up UK state pension
 

Hi Ozzie, can you let me know (via PM if preferred) where I can get anything close to a 5% return on a term investment. All I can find is a fraction over 2%, which is very piss-offery! Ta :)

ps I'm old enough to remember the days off 10% interest on term investments :scaredhair:

Re: Planning for retirement/topping up UK state pension
 

I was thinking more about the Challenger rates and their Ilk to be honest. The figures quoted are for every 100K invested.

https://www.challenger.com.au/personal/products/payment-rates/lifetime-annuity-payment-rates, or ha

Also Host Plus index linked Super and they have a lot of varied options....pays a very high rate and has done for years. Not sure you can get into those, once you have both left the workforce, but you can open spouse accounts if only one is working. They work on minimum 10pct drawdown AFAIK..... Generally speaking that keeps your whole balance intact or has done for decades uptil this point.

So Annunities and flexible super.....

A lot of people around here, and there are dozens of outlets dedicated to it, is buy gold bullion. Coburg has to be the Gold Bullion center of Melbourne. I think our middle eastern people are onto something with those. There are literally 10 outlets in our small shopping strip, then a lot more along the whole of Sydney road.... and they are always crowded. There has to be something in that, that I've not explored properly yet.

Re: Planning for retirement/topping up UK state pension
 

Westpac dividend yield 6.4% fully franking (thanks ScoMo/Josh - imagine how f**ked we'd be if that dickhead Billy Shorten had got the gig!). Solid as a rock (too big to fail) - and there's even better out there

Boom! Capitalism is a wonderful thing

Re: Planning for retirement/topping up UK state pension
 

For what reason? Obviously there is no dividend, however they may be speculating on price appreciation.

Of course it could be an alternative to "cash under the mattress" too...

Re: Planning for retirement/topping up UK state pension
 

Yes would agree with that. Conversely anyone not returning probably should steer well clear of any top up, taking the frozen pension into consideration. Probably the last thing people should do. Especially when the base Aus Government pension is 150 bucks a week higher.

Re: Planning for retirement/topping up UK state pension
 

Yes I think it's the second point, where one wants to hide from things like the means test and be assured of long term growth. Plus it's very easy to liquidise, in fact it's pure liquidity really.

Plus a lot of those of Meditteranean background seem to distrust insitutions.

Re: Planning for retirement/topping up UK state pension
 

Yes combine that with the fact that you can dip into ones super, (withdraw lumpsums etc) thus reducing your assets as you wish equates to a lot of flexbility on how one approaches the Pension System in Australia.

Hence even more reason to seek professional guidance.

Do people actually upsize into more expensive property later in life to get onto the Aus Government pension scheme, thus reducing their testable assets.... I can see a case for it.

Here's an article well worth reading Freebo :)


https://www.goldsborough.com.au/enew...ce-the-impact/

Re: Planning for retirement/topping up UK state pension
 

For those having trouble understanding the assets tests limits and income limits for the Australian Gonvernment Pension..... Here is a calculator that sheds a pretty clear light on the situation.

Invaluable actually.

https://www.noelwhittaker.com.au/res...on-calculator/

Re: Planning for retirement/topping up UK state pension
 

Because I've got a lot of time on my hands now I'm retired, I've just worked out the cut off figure as in assets and income as to when you become worse off in Australia on the Australian Pension v the UK Pension. It's quite a surprise I would think for most.

Given that the average Pension for Men in the UK is 143 GBP per week and for Women 151 GBP according to government figures. I used a pension calculator to see when the Australian Pension which is a much higher figure than the UK figure, falls to those UK levels given the effect of the Australian assets test

So for the figure to fall to 1130 AUD Per Fortnight which is that average above converted from GBP for a couple of 586 GBP per fortnight. The Australian base pension is 1700 AUD per fortnight for a couple.

The Assets one would have to have to fall to that UK figure is 480,000 AUD/246,00 GBP (combined per couple) over and above ones home and you can also work and earn 780 AUD/400 GBP (Combined per couple ) per fortnight to have the assets test fall to the level of the "Average" government UK pension.

Make of that what you will.