New research shows that a third of Australians delay applying for the Age Pension or don’t apply at all, leaving many without money they are entitled to in retirement.
Super fund Cbus found many retirees are losing out on up to $46,000 per year as a couple because they aren’t confident about how the system works, and delay their Age Pension applications.
The fund said some people wait a year or more before applying, and Services Australia does not backpay any pension money for the period before an application is made.
Cbus acting chief member officer Bernie Dean said “low confidence and complexity means many are leaving money on the table”.
“We’re seeing older tradies and construction workers relying on their super too soon, missing out on vital government payments that could help them live more comfortably,” Dean said.
He added that Aussie couples are potentially losing out on almost $900 per week.
Cbus, which represents many building and construction workers, said the insecure nature of work later in life makes the situation even harder.
According to its research, nine out of 10 members close to retirement did not feel confident about understanding their government entitlements. Only 36 per cent said they clearly understood the age requirements for the pension.
Separate research from MUFG found nearly one-third of pensioners waited more than a year after becoming eligible to apply, including 16 per cent who waited over three years.
Dean said the Age Pension system can feel “complex” but urged people to check their eligibility early, as many could receive more than they expect.
The current Age Pension age is 67 or older and to qualify, people must meet income and assets tests, along with residency rules.
Right now, the income cut-off is $2,575.40 per fortnight for singles and $3,934 per fortnight for couples. The asset limits range from $714,500 for a single homeowner to $1,332,000 for a non-homeowner couple.
The maximum fortnightly pension rate is $1,178.70 for a single and $1,777 for a couple combined, with these rates changing every March and September.
Australians can lodge their Age Pension claim up to 13 weeks before turning 67, and all applicants need are proof of identity and details about their income and assets.
Services Australia says some people already receiving an eligible payment may be able to transfer to the Age Pension more easily.
“If you’re currently getting an eligible payment, you may be able to transfer to Age Pension instead of doing a full claim,” Services Australia said.
If someone has previously been rejected but their circumstances have changed, they can apply again at any time.
For those unsure about how their finances affect their eligibility, Services Australia offers a free Financial Information Service, and Community Engagement Officers can also provide help.
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