Retiring overseas with the Age pension
Retirement | 10/10/2016 |
2 min read
Retiring overseas is an increasingly popular option. Current estimates place 77,000 Australians retirees on foreign soil, up from 23,000 two decades ago. But how easy is it retire overseas, and what does it mean for your age pension benefits?
According to the Department of Human Services, the age pension can be claimed overseas, and is determined by the same means and assets testing found here in Australia. For a couple, that equates to approximately $30,000 per year in government payments. And while that might not go very far in Sydney or Melbourne, it can afford a very comfortable life in other parts of the world, especially when you factor in exchange rates.
The most popular overseas destinations for Australian retirees are Italy (16,000 people), Greece (12,000), and New Zealand (9,000). That said, Asia is proving an increasingly popular choice, and as Steve Wyatt, co-author of Sell up, Pack up and Take off explains, retiring in Asia could cost up to 80% less than Australia.
Before you start thinking about Greek isles or Thai beaches there are a number of factors that need to be taken into account.
1. If you’re already based overseas and want to claim the age pension you’ll need to return to Australia for two years before you’ll be eligible. This is particular relevant for self-funded retirees who plan to access the age pension when they’ve exhausted their own savings.
2. You must be an Australian resident for 35 years to receive the full age pension. If you have lived in Australia for less time the rate will be proportionate.
3. If you’d like to get a taste of overseas life before fully committing you are allowed to rent out your home and move overseas for a period of time while still receiving your payments. The rules around this vary, but you can read more on Department of Human Services website.
Tempting as it might be, moving overseas isn’t a decision you should take lightly. This is especially true if you suffer from health problems that may require specialist treatment.
You can find out more about your options and weigh up the pros and cons by speaking to Centrelink and a financial planner. Equip offers a range of retirement services and our financial planning team can answer your specific questions, please click here for more information. You can also check the Australian Government’s Department of Human Services website for additional details.
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