Recently unemployed and JobSeeker Changes from September 25

Please refer to this article for further info about govt changes taking effect from next month:
https://www.abc.net.au/news/2020-07-31/jobseeker-liquids-ass...

Essentially, the govt is starting to wind back Jobseeker/Jobkeeper payments by reducing the Coronavirus supplement by 50% and reintroducing the liquid assets test, as of September 25 2020.

"The "liquid assets test" was removed as the COVID-19 took hold, but will be reintroduced for JobSeeker applicants on September 25. For singles, the test threshold is $5,500. For singles with children, it's $11,000".

$5,500 is a paltry amount of savings that the govt allows you to have in your bank account. I would consider my last $5000 to be "emergency funds" with alarm bells going off in my head. I do not wish to get into a debate about this threshold and whether it is reasonable or ethical to expect someone in 2020 to live off 5k in the bank. It seems like prudent savers are getting punished with the govt saying we should "support ourselves", which is fair enough. I just wish the threshold was a little higher - somewhere in the realm of $25k - 30k minimum.

Suffice to say, I have substantially more than $5000 in savings but not quite enough to feel financially comfortable.

My situation : mid 30's, single, own my home, recently unemployed.

Do you think it will be worth it for me to apply for Centrelink straight away before they implement these changes next month or will they simply just cut off my payments once the liquid asset testing comes into effect?

The other option (if I cannot find another job in the current economic climate) is to simply live off my savings, gift $10k p.a to a family member that I owe money to.,enjoy a lavish domestic holiday, gamble it all away at the casino, etc until there is nothing left.

A final option would be to invest all my money in purchasing enveloop batteries. They will be considered an "asset" by centrelink and therefore I can accumulate up to $250,000~ worth of batteries because I am converting the money into an asset class which will therefore be counted in my "assets test".

Comments

  • It seems like prudent savers are getting punished

    That's socialism for ya.

  • +4

    https://www.servicesaustralia.gov.au/individuals/services/ce...

    It just means you have to wait up to 13 weeks before they'll pay, not that you won't get it…

    Edit: what is the definition of liquid anyway? Cash in bank, shares, monies sitting in redraw (not offset)?

    • That's good to know. I will apply straight away and wait 3 months :)

      I'm still trying to find a definition of liquid assets.
      For example, what about a term deposit?
      The money is locked away for the duration of the fixed term, would it be unreasonable for centrelink to expect you to break it (incurring a penalty by doing so) to access additional funds?

      • +1

        That doesn't sound right. Liquid assets waiting period is now waived until they bring it back, which means if you apply now and are approved, you should get payments immediately.

      • What are liquid assets for Centrelink?
        Liquid assets are any funds readily available to you or your partner. This includes money your employer owes you.

        Liquid assets are funds that you can use right now. Money in your bank…

        You don't have to sell an asset to get money. For instance, you don't have to sell your hamster to get money. Investment in a hamster is considered illiquid assets.

        • +1

          Investment in a hamster is considered illiquid assets.

          Phew, I was getting worried.

      • -1

        Keep it in cash. Literally. Look at renting a safety deposit box.

  • +12

    I would consider my last $5000 to be "emergency funds" with alarm bells going off in my head.

    I think many more people have much smaller, if any, emergency funds.

    Suffice to say, I have substantially more than $5000 in savings but not quite enough to feel financially comfortable.

    It is meant to be for those who really need it.

  • +20

    Hmmmm. Plenty of cash, owns a property, no dependents and wants a handout? This sounds like the Australian dream.

    • Yep, should start renting out rooms and turn that liability into an asset

    • Prefer people like this who are down on their luck than the "full time centrelink" type of people.

      • +2

        There aren't as many of the "full time centrelink" as you think and to think that you can "live" on $250 a week is a joke and pretty stupid.

        The Gina Rineharts are the real scum of our society.

  • Here's a couple of statements from official sources:

    As part of the response to the Coronavirus (COVID-19) outbreak, the liquid assets test waiting period does not apply from 25 March 2020 to 24 September 2020 for the following payments: JSP, YA and Austudy. A person already serving a waiting period at 25 March 2020 will no longer serve the waiting period and be backdated to the date of claim.

    At the end of the exemption period, recipients do not have any remaining waiting period to serve.

    The liquid assets waiting period may apply to you if you're making a new claim for 1 of the following payments:

    JobSeeker Payment
    Sickness Allowance
    Youth Allowance
    Austudy.

    • The first paragraph contradicts the second paragraph.
      1st is saying that the waiting period does not apply, 2nd says it "may apply". Or does it mean you would have need to have applied before 25 March for the waiting period to now be exempt?
      You need a Phd in Centrelink just to understand their rules and jargon.

      • +1

        This is my bad, I missed out a paragraph:

        We’ve removed the liquid assets waiting period for JobSeeker Payment, Youth Allowance and Austudy from 25 March 2020. This is due to coronavirus (COVID-19). We’ll let you know once this starts again.

        I think the message is quite clear. The LAWP is in effect for all new new claims after September 24/25. If you apply now, you are exempt. If you applied after 25 march to now, you are exempt. If you applied before 25 March, you had LAWP, but they removed it when 25 March came around and started payments.

        • TYVM for clarifying this :)

  • Yep, i initially applied on the 14th of March and was informed i'd need to wait 13 weeks because i had more than $60k in savings. March 25 arrived and the payments started.
    But agreed, it penalises those that were more frugal with money.

    I look at it as if i could've gone out, been careless with my money, bought a high yield investment and been eligible for immediate payments. The current policy doesn't exactly support those trying to save for a first home. But then again maybe that's the government's aim to keep everyone working until they die.

    • +1

      Yes this is consistent with the messaging. when Mar 25 came around, they removed the LAWP and everyone who was previously waiting, immediately started getting payments.

    • Are we supposed to feel sorry for you? $60k in the bank and looking for a handout. Lol. Welfare is for those that actually need it.

      • So you'd recommend buying a high yield investment vehicle instead? Put myself in debt then apply for welfare?

        Because that's what the government wants me to do.

        • +2

          You don't need welfare. You have the means to support yourself with the money you have saved. Why do you assume that people with no money have bought a 'high yield investment vehicle' or pissed it down the drain to the point they have nothing left? Are there people out there that have? Yes. Are there people that genuinely need it? Absolutely. You've been fortunate enough to have landed a job and been in a position to save over $60k so use it to support yourself and not rely on the taxpayer to.

          • +1

            @nomoneynoproblems: For risk of sounding like a broken record, the point is the welfare system favours those that are not necessarily the most financially careful people. How you get there isn't taken into account.

            If i was frivolous with my money, take out a massive loan or dump it into high risk shares the government is there to support me (yes there are people that actually deserve welfare that are just on hard times) however if I save my money and keep it as liquid assets I'm on my own, no matter how much tax I paid 🤷‍♂️🙃.

            It doesn't matter that you might be saving for a house. Use that to get by while my mate driving a Mercedes is on $1100 a fortnight

            • +1

              @Drakesy: And in all fairness it probably shouldn't take that into account. Why would it? The oft chance someone manages to make money and spend it? You don't need a hand out if you have the money. End of. You'd be hard pressed to find an honest tax payer that looks at your balance and agrees. Congratulations on your mate. He's broke but drives a Mercedes. And is on welfare. You're telling me you envy him because he gets a handout?

  • +5

    "mid 30's, single, own my home"

    you are well well well above the average oz, who mostly are still renting on their 50's with 4 of their children's and 2 cars.
    congratulation!

    • +2

      Thanks man. I just consider myself average. I have never been a "career" person or had well paying jobs (average $50-60k) but I worked hard and saved, put all my money into my home, and made a conscious decision not to ever live in a capital city (unfortunately there are fewer jobs but the cost of living is cheaper). I hate being in debt. It keeps me awake at night.

  • +1

    " I would consider my last $5000 to be "emergency funds" with alarm bells going off in my head."

    agree i would probably hang myself already if my cash is down to $5k

    • +3

      Would you spend it first?

  • +1

    Apply straight away, go over the paperwork real slow and get creative if need be

    Also go here
    https://www.ozbargain.com.au/node/560825

  • Are you trolling ?

    How difficult is it to make 5.5K in the bank to disappear ?

    Kindergarten should have taught you thousands of methods :)

    • The only caveat is: don't be penny wise and pound foolish.

  • Yo, does anyone know what it means by income test requirements? for casuals?

  • Its interesting, say you lost your job but you were saving for a car, after paying off all your bills you have $5300. You then decide that instead of spending money on smokes to put away $50 a week to save. I am wondering if in one of the weeks you tick over $5500 would they make you spend all the money and wait 3 months to go back on centrelink because of how rich you are. This is not a good way to encourage people out of poverty especially when people have $500,000 houses that get centrelink.

    The way I understand it is on 25th of september they will sort of mark what is in your bank account and if its over $5500 and you continue to get centrelink, you will probably get a robodebt notice in between now and in 15 years.

    And if you have a car worth say $7000, you are just simply not eligible for centrelink.

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