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Retirement | | 2 min read
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If you’re thinking about retiring in Australia, there’s a good chance the Age Pension is part of your plan. 

The good news is that there are no government plans to scrap the Age Pension, and little evidence to suggest it will be stopped anytime soon. 

However, when it comes to thinking about retiring, the question we should all be asking about the Age Pension is less “will it still be around when I need it?” and more “will it be enough for me to live on?” 

By asking yourself that question, you can begin to consider the type of retirement lifestyle you desire and adjust your retirement strategy as needed.  

Why the Age Pension isn’t going anywhere in 2025 and beyond

The Age Pension continues to play a vital role in retirement, and there are a few good reasons why it’s here to stay.

1. It’s sustainable by design

Australia’s Age Pension is one of the most sustainable public pension systems in the world. According to research by the Association of Superannuation Funds of Australia (ASFA), Australia spends just 2.3% of our GDP on the age pension, far less than the OECD average of 9%.

That’s thanks to our distinctive system, where compulsory superannuation works in conjunction with a means-tested pension. It’s smart, efficient, and designed to support Australians for the long haul.

2. It matters to millions of Australians

As more Australians approach retirement, older voters are becoming a stronger voice in our democracy. And with so many relying on the Age Pension, significant cuts are not only unpopular but also politically unlikely.

What is far more likely is that we’ll continue to see gradual changes over time, such as updates to eligibility rules and changes to payment thresholds, to keep the system fair and sustainable.

3. It keeps adapting

The Age Pension continues to evolve to meet the needs of today’s retirees.

In 2025, the income test and assets test thresholds were raised by 2.4% meaning Australians can now earn more and hold more assets before their payments are affected. For some, this increase has made them eligible for the Age Pension for the very first time.

It’s a good sign the system is doing what it’s designed to do: support those who need it most.

What might change in the future? 

No one can predict the future, but there are a few key areas where changes to the Age Pension are more likely than others.

Retirement age could shift

In 2023, the qualifying age for the Age Pension rose to 67. There are no official plans to raise it again, but discussions about increasing it to 70 continue to surface, especially as Australians are living and working for longer.  

If it does change, it’s likely to be phased in gradually, giving people time to prepare. 

Income and asset testing limits are always moving

Access to the Age Pension isn’t just reliant on age; it’s also means-tested, which means your income and assets play a key role in how much you receive. 

These thresholds are reviewed three times a year, in March, July and September, and any adjustments are linked to changes in the cost of living and inflation. 

Indexing rules may evolve

Pension payments are adjusted in line with inflation and wage growth every September and March. However, with rising costs, such as housing and food, there is an increasing debate about whether those adjustments are enough.

In future, we may see pension payment adjustments better aligned to the specific needs of retirees, such as applying a greater weighting towards the change in healthcare costs.

Explore our Knowledge Hub

Australia: a global leader in pension reform

Australia’s retirement system is often recognised as being one of the best in the world. By combining government support with personal savings through superannuation, we’ve built a balanced system that’s both fair and financially sustainable.

The Mercer CFA Institute Global Pension Index compares retirement income systems across approximately 50 countries, evaluating how effectively these countries prepare their populations for retirement. 

​​​Every year, each country receives a score out of 100 and a corresponding letter grade (A to D), which reflects the overall strength of its retirement system.  

  • In 2023, Australia earned a B+ ranking, placing 5th out of 47 nations with a score of 77.3%.

  • In the 2024 report, Australia again secured a B+, but slipped to 6th out of 48 countries, with a score of 76.7%.

The takeaway? Australia still ranks among the world’s top retirement systems, but there’s always room for improvement.  

The question to ask when making retirement plans  

For most Australians, the Age Pension will play a significant role in their retirement income, but for some, it won’t be enough to cover all expenses. 

It’s worth thinking about: 

  • how much you will need to live comfortably in retirement

  • what government benefits you could be eligible for

  • how your income and assets might affect what you receive

  • if your super can be supplemented with Age Pension payments.

The rules can change, but one thing remains the same: having a clear plan gives you more control and peace of mind. If you’re not sure where to start, our retirement experts at Equip Super can help you make a plan. 

Frequently asked questions

Yes. The Age Pension is a longstanding and essential part of Australia’s welfare system. While the rules around it may evolve, there are no signs of it being removed altogether.

Possibly. It has already risen from 65 to 67. Future increases would likely be phased in gradually and tied to longer life expectancy.

Australia’s super system is one of the most robust in the world, but like any system, it isn’t perfect. It’s historically favoured people with steady, full-time work, so those in lower-paid or part-time roles haven’t always benefited in the same way. This has contributed to a noticeable gender gap in super balances, with women often retiring with less due to time taken out of the workforce to care for children or family. There are ongoing efforts to make the system fairer for everyone, including better support for carers and low-income earners.

Yes, there are some situations where you can access your super early. This includes if you’re in severe financial hardship, you need money for urgent medical treatment, or you have a terminal illness or permanent incapacity.

Everyone’s retirement needs are different—it depends on your lifestyle, spending habits and plans for the future. A good place to start is to use our Retirement Lifestyle Calculator. It can help you estimate how much you might need and whether you’re on track.

Issued by Togethr Trustees Pty Ltd ABN 64 006 964 049, AFSL 246383 ("Togethr"), the Trustee of Equipsuper ABN 33 813 823 017 ("Equip Super"). The information contained is general advice and information only and does not take into account your personal financial situation or needs. You should consider whether this information is appropriate to your personal circumstances before acting on it and, if necessary, you should seek professional financial advice. Where tax information is included, you should consider obtaining taxation advice. Before making a decision to invest in Equip Super, you should read the Product Disclosure Statement (PDS) and Target Market Determination (TMD) for the product which are available at equipsuper.com.au. Financial advice may be provided to members by Togethr Financial Planning Pty Ltd (ABN 84 124 491 078 AFSL 455010) – a related entity of Togethr. Past performance is not a reliable indicator of future performance.

© 2023—2025 Togethr Trustees Pty Ltd ABN 64 006 964 049 AFSL 246383 — *Past performance is not an indication of future performance.
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