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Member's Question: 'Centrelink radically reduced my Aged Pension. What should I do?'​

Hey there, members!

We’re wrapping up the week with another round of our ‘Members Helping Members’ segment: your space to share tips, advice, and a little wisdom with each other.

For today, here's a question from an anonymous member:

I got an inheritance from a beloved Brother a year and a bit ago. It was paid directly into my bank account. Centrelink looked at what they 'deemed' I earned and radically redtuced my Aged Pension until it reached the required amount. This isn't fair, I thought, as I had the money in an Account that made no interest, thinking that it would be okay. Not so. One of the Centrelink staff actually said when I asked what I can do to remedy this, she whispered 'You ought to go on a holiday to spend the excess $16,000. So far I haven't done it. Have you any thoughts dear Members on what I should do? Thank you all.

Got advice, tips, or experience to share? Comment down below!

If you also want to ask a question or for advice, you can always send yours via our anonymous form or simply post in our Members Helping Members forum!

 

[Parrot]

Unfortunately if you want to remain on the “ books “ with Centrelink one has
to accept their findings .

 

[Suzanne rose]

It must have been a large inheritance for this to happen as a couple who own a house can have $481,000 in asset's or non home owner $739,000 in asset's before affecting pension.

I would do what the centrelink worker said, spend the $16,000 go on a holiday, buy new furniture or renovate your house

I added a table below

 

[Giannidifirenze]

It must have been a large inheritance for this to happen as a couple who own a house can have $481,000 in asset's or non home owner $739,000 in asset's before affecting pension.

I would do what the centrelink worker said, spend the $16,000 go on a holiday, buy new furniture or renovate your house

I added a table below

Is ‘furniture’ a reportable asset?

 

[wildroseforever]

Put it under your mattress

 

[Rain72]

Is ‘furniture’ a reportable asset?

Yes, but at "fire sale' value. In other words, the price you would get for it if you had to sell it tomorrow with no time to advertise and wait for a buyer willing to pay a fair price. So realistically, most of your furniture is worth next to nothing for Centrelink purposes. But really, whoever dreamt up the rules is sick in the head. Just think, for example, of a musician owning an instrument that is of significant value. It might be the only thing keeping him/her sane - being able to continue a loved activity. What about the hobby fisherman whose boat is the only thing making life worth living in old age? Are pensioners expected to gift or sell the family heirlooms they have treasured for years and all the tools and devices that make life in old age worth living? Should we all drive old cars for fear of a pension cut if we upgrade to something newer and therefore potentially much safer?

As for deeming rates, they are brutally unfair in today's world where most banks pay virtually no interest unless you keep increasing your balance every month - which pensioners neither want to do nor should be doing generally. Term deposits are not always a suitable solution.

It has been repeatedly proven with expert calculations that it would be cheaper to pay all our aged folk a pension and apply fair taxation to retirement income.

 

[Jash]

Ask for an appointment to see the Financial Advisor at Centrelink, they should help you out.

 

[lizzy22E]

get it in $10,000 lots & it classed as a gift, & won't affect the pension. you are allowed to get $10,000 gifts several times , & no penalties ever.

 

[MrCejay]

about says get it out in $10,000 lot that's above the limit - take it out in lot less of that $8,200 then no explanation of what you do with the $$$s - either Centrelink or the bank

 

[Thecla]

Ahhh the good old deeming rate as seen by Centrelink. When we sold our family home of nearly 40 years a few years back we were downsizing into an over 55’s complex. It wasn’t quite finished due to covid. We rented our house back from the new owner then lived in a friend’s granny flat for three months. We just put the money aside for the new property into an everyday bank account, we’re not interested in any interest but the bank said if it was there for 12 months we should get $6k. We thought ok. We declared all this to Centrelink, they deemed we would get $45k in interest. When I asked if they were going to pay me the difference the woman shot daggers at me. Once the paperwork was filled in and submitted it took Centrelink six hours to cancel my hubbys part pension. Zip zero zilch coming from them. We downsized like the govt suggested no penalties the govt says but here we were back to paying full price for everything. I was six months under pension age at that time. Hubby applied for health care card to get cheap er prescriptions but no nothing for me. Just spend the money. It was nothing you were relying on to live, have a bit of fun with it whilst you

 

[Isis]

A friend got a $15,000 windfall. Put most into an account spent a little on travel. But she got ahead even before receiving the money. Told Centrelink.money arrived with no change to her pension. It can happen so look further into their reasons

 

[Luckyus]

When my mothers home was sold, I rang Centrelink and Asked them the implications were and all they asked was a one-off payment and that was that no lowering of pension?