How to improve income and lifestyle in retirement

[@AboutRetirementTV]

Which of the 3 options is your preferred? What would you do if you were Tom?

[@johannamit4388]

Thank you so much Katherine for taking the time and effort to make these very informative videos.

[@AboutRetirementTV]

Thank you Johann, I am very glad to hear they are helpful, please tell your friends and family to watch and learn as well. 😀

[@johannamit4388]

@@AboutRetirementTV I already have and will continue to do so. Thanks.

[@cathykem]

In Tom’s position I would free up some equity from the home using the governments home scheme (reverse mortgage) currently about 3.9%

[@tecnaman9097]

Tom will have to set aside 23K (in Victoria) for stamp duty when he buys his downsizer. Also factor in 2% commission plus advertising for the real estate agent to sell his 700K home, that's going to be at least another15K. Then there's conveyancing costs to sell and buy etc etc. So Tom can really only afford to buy a property in the vicinity of 455-460K. When downsizing these 'hidden' costs need to be taken into consideration . If you leave them out you might get a rude shock. Do you agree with what I've said Katherine?

[@aussietaipan8700]

Option 1 for me, I'm both a day trader (options) and long term investor (shares and dividends). Options for me are great as they can be used on both bull (call) and bear (put) markets, The trick is to understand the underlying share price movements and not being greedy. Well at least not too greedy! Also, Options (for other readers who may be interested) are not set and forget, that's why I'm s day trader, I keep my eye on them at least twice per day.

[@leanderchan9890]

Katherine, Your videos are always very informative and helpful. Thank you! After watching your video on Annuity, I do have a question. Am I correct in that age care pension asset tesr can be reduced 40% of annuity amount in the asset value? I am assuming that's why in Tom's case the 300,000 annuity can lowered the asset value assessed, and produced some 12,000 in pension payment. Thx.

[@filipwouters6887]

Wow , option 3B was smart. I would have said reversed mortgage to start with, but indeed not an easy choice. Home ownership is good as you can always downsize or sell way down the track and move into option 3B. Once the house is sold, it’s sold, now way back.

[@AboutRetirementTV]

Hi Filip, so true. And at the end of the day, the decision is really about your specific lifestyle and income. There is no right or wrong here, just which choice is suitable in a particular time. Thanks Filip 😀

[@chrisj6321]

@@AboutRetirementTV so as i said we have two houses one worth 700k and the other 500k. Is there a possible way to get hold of pension by selling both and buying a 1.2 million dollar place so that we dont fail the asset test. I think thats a yes but what if we then need money can we take a reverse mortgage.. no kids so dont care about leaving anything.

[@AboutRetirementTV]

@@chrisj6321 Absolutely you can Chris, just leave yourself some money extra, don't spend the whole lot on the house, as you will need money for living expenses, watch my video about Asset Test, that explains how much you can have and still get Age Pension kzbin.info/www/bejne/i4XWaqiteMaAfKc

[@theheartofbrunswickisyourc2696]

I have a question, ive started the online claim, however i havent finished it, i have till March 20, can’t change my UniSuper details, why? i typed in a figure, in the application, however, my UniSuper figure has fluated down 6,000 less, still I started the application thru Centrelink App.

[@sandraroy6674]

Rent spare rooms to students, cash only.’

[@chrisj6321]

there could be an option to downsize go unit but stay in same area

[@AboutRetirementTV]

Absolutely Chris, this is a perfect plan if you can find a property that fits the price. Video is more about explaining the principles of options and Age Pension.

[@deborahs3799]

I thought the same thing as Chris. Most people as they get older dont just downsize to release equity they also downsize to a smaller property that is more manageable, so there is no need to move to a different area/town but rather hopefully find something smaller in or close to the area they want to live in, family and friends. Win Win.

[@chrisdavies3037]

You don’t mention rates, renting as I do , you are always afraid of the rental being sold, moving is expensive and rent is always more. Difficult

[@johnstephens1574]

Katherine - great videos. In maximising my Government aged pension, can you please explain how Centrelink assesses Super invested in a annuity, as opposed to my current Super remaining in a accumulated fund. I understand that my Super balance will become a major asset upon reaching age pension age and therefore will virtually prevent me from getting a Government pension. Thank you.

[@AboutRetirementTV]

Hi john, thank you for your comment, referring to your annuity question, annuities are very difficult and impossible to give a general answer, as the Centrelink treatment will depend on the type of annuity you have and the commencement date. this is due to ongoing government changes in relation to annuities. Once you reach your Age Pension age and are eligible to apply for Age Pension, then yes, your super will be fully assessed under Income and Assets Test. My sincere recommendation is to get the full professional advice, yes I know you will pay for that but you might be surprised of the outcome, or at least at the preliminary appointment a good Financial Planner specialising in retirement will be able to advise you the likelihood of your eligibility and how that can be optimised for your benefit. Katherine

[@deborahs3799]

@@AboutRetirementTV Isn't there some rule that centrelink only assesses 60% of the income from annuities compared to 100% of regular account based pensions? Is this why using the annuity gives a better outcome?

[@jeffm7294]

working after retirement! any suggestions!

[@AboutRetirementTV]

Hi Jeff, absolutely, and many retirees chose this option. I think I should prepare a video about different choices of part-time work for retirees. Are you doing any part-time job? This is a great idea, thanks Jeff 😀

[@jeffm7294]

I don't qualify for pension until Nov 2022 but intend to continue working. At a reduced level. Will own our own house with approx only $150,000 super.

[@AboutRetirementTV]

@@jeffm7294 That's great Jeff, you and your partner should then be eligible for the full Age Pension. As long as you organise your super investments correctly in a pension fund, that it keeps up with inflation and grows in value, even though you are drawing money out for your income, you can have an enjoyable retirement.

[@tomwaters5115]

Hi Katherine, What about Tom renting out his house for say $650-700 a week and then renting something smaller for say $380 a week. He will probably pay council costs, real estate property manager and water bill etc for $100 a week so he pockets $220 a week from that. $11,440 income a year. Would he still be eligible for pension this way?

[@AboutRetirementTV]

Hi Tom, I love your thinking, but I believe there are couple of issues, the rent level you are talking about indicates yield of approx 5%, today's rent is closer to 2.5%, which is $450-470pw. As the house is rented, Centrelink may no longer exempt the property as primary residence and that will cause the drop of Age Pension down to the same level as selling home.

[@chrisj6321]

Not sure if I told you this already but what do u think of my plan. We have an investment property which is smaller than our property but in the same suburb. Aim is to pay both off before 60 then around age 70 sell the main residence and move into small investment. It will be more manageable as I get older but has advantage I can pocket full value of house sale with no CGT and put into super as downsizer contribution

[@AboutRetirementTV]

Yes, you can, just be careful with contributions rules, as there is an age limit for downsizer contributions.

[@hooing7771]

Hi Catherine, what type of investment $400k @3.5% you mentioned ? To which organisation? And how safe are them?

[@AboutRetirementTV]

Hi Hooi Ng, thank you for your question, this is by no means any recommendation or any particular product. This is just a pure estimation of returns as a comparison and an exercise. I do not provide any product recommendation via my videos, nor am I allowed to do so (prohibited by law). Advice on products requires a personal advice situation, so actuall. working together one on one, as there is no one product that would work for all. I hope it makes sense. My videos are of general advice only,

[@johntay7450]

Hi Catherine. At any stage wil Tom be paying tax?

[@AboutRetirementTV]

Hi John, I am guessing you are referring to the very last option of $42K income, annuity income is tax free, so is the rental assistance, leaving only Age Pension and investment income as taxable, with Pensioner Tax Offset, Tom would not pay any tax at all.

[@glennryan8440]

Tom should budget. If he takes a loan against his home he may be kicked out on the street before he dies.

[@gregt8655]

Hi Katherine, I only recently came across your channel, which has been very informative. If I may I have a question, I have a government pension which gives me a defined benefit and rises in line with the CPI. Is there anything I can do to minimise the effect it has on my aged pension?

[@travicedesilva208]

Hi Katherine I have an investment home that I intend to gift to my daughter when I pass on Currently she pays rent of $1500 and the interest on the loan is $1350 Does Centre link treat the difference as my income or can I deduct it to meet costs of Council rates maintenance costs etc. is there a limit that Centre Link allows for expenses on an investment property in calculating pension payments

[@AboutRetirementTV]

Hi Travice, thanks for watching and your question. Please watch this extra video, fully devoted to ownership of an investment property. This should answer most of your questions kzbin.info/www/bejne/Y3zMqZ5ulLStd5I

[@hugonardini790]

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