My question deals with the following:
Your pension amount starts reducing by $0.50 for every $1 your income exceeds above and does not include the work bonus
taken from here about age pensions.
Afaik that's not (strictly) a "taxation" so what's the exact fiscal definition of that "reducing"?
This. It's not a tax thing, as the pension is paid by Services Australia. It's a means test.
whation
reducing = get less free stuff (money in this case)
Aged pension - the biggest drain on the social system and pretty much the only payment thats kept up with inflation.
Now they're getting tax breaks to work as well
I'm all for supporting the elderly but when you have people in their 20's and 30's struggling to afford a house and family while those with houses get hand outs you have a problem
A) not all pensioners have houses
B) at the time they were working, these people were told they would be looked afyer in old age after paying tax their whole lives, super wasn't a thing.
Super has been a thing in this country for over thirty years!!!
There are damn few retired people alive who never knew about it during their working lives - and even before compulsory super was introduced it had been bleedingly obvious for years that the system had to change and people couldn't jus rely on the pension
Having super for 3 years at the end of your career isn't very helpful 😂
Of course it had to change, hence it has, and we now have super.
when you have people in their 20's and 30's struggling to afford a house
Always been the case hasn't it? Unless you are born into money.
As for old people who have no money because they pissed it all away… that is something worthwhile to get unhappy about
The elderly were once in their 20's and 30's struggling to afford a house and family. They also paid higher income tax in their day as well as higher sales tax (15%-22% depending on the item) including on food. Sales Tax today (gst) isn't applied to food and medicine and is only 10%. It is a much fairer system today, not so for struggling pensioners - but getting there.
elderly were once in their 20's and 30's struggling to afford a house and family. They also paid higher income tax in their day as well as higher sales tax (15%-22% depending on the item) including on food
But they got free education…. oh wait… maybe that is the key… people just need to get educated. Unpopular opinion. You can do an arts degree but if you realise after 5 years it doesn't cut it you'd better grind through some kind of finance degree.
Pretty much, learn something of actual value, or don't complain that your arts degree only nets you $45k a year as a barista.
A) not all pensioners have houses
I get this, but if you lived through what was some of the cheapest housing in history and didn't get into the property market i do question what they did with all their money? Say they lived a frivolous life but now realised they were going to run out of money come retirement should it really be on the taxpayer to prop them up? Something that this generation may never be able to do, let alone afford a family?
My wife's grandparents were like this.
He worked all his life and somehow managed to die without ANY assets other than personal effects and an old car.
He lived in a granny flat behind his daughter's house, had no real savings…
I struggle to understand how someone can work their whole life and never actually accumulate anything. And its not like he lived flamboyantly or threw money around.
threw money around
Many ways to leak money
The idea of savings is to save the money invest it and have more money to spend and the cycle continues. Some people just spend it and not save it therefore depending on the money to continue to flow. Money from working from say 20 - 65 then the government takes over (so that is the hope)
Sounds like he timed his money and length of life perfectly - some run out of either beforehand.
He was flat broke the entire time I knew him - about 15 years.
I struggle to understand how someone can work their whole life and never actually accumulate anything.
People struggling to make ends meet isn't something new and exclusive to the current generation. There's always been people in this boat, he was probably one of them.
No idea what they did, but at the time there was no super, and people were told the pension would support them.
i do question what they did with all their money
So do I, I work with a guy who is bearing retirement age and has no house, no savings, credit card debt, and only about $100k in super.
The thing is, people these days also waste a heap of money with nothing to show for it.
heap of money with nothing to show for it
They have. Temporary show.
There was a story told that my grandfather had a safe in his younger working days. When a relative came over and he opened it basically it was full of money and a lot of it fell out. Not sure if it was real. But he retired living off his kids. Lucky he had quite a few that did okay for themselves and each contribute a bit every month.
Temporary show
I'd rather my house paid off than have the latest iPhone and a pov spec Audi on finance.
I can see both sides of this argument.
It's true that baby boomers (and earlier generations) were very lucky with respect to house prices, even if they assert they had higher interest rates. Right up until about the year 2001, anyone with a full-time job could go and buy a decent house in a capital city. Nowadays, you either need to have a 6 figure salary, or you and your partner (who also has a full-time job) need to engage in some kind of complex financial manoeuvring to get into the market and eventually upgrade to a decent house in a capital city.
But there are other factors to consider too. People get divorced, then their buying power (or mortgage repayment capacity) is nearly halved. Sometimes an employer or an entire industry goes bust, leaving employees without reliable work after devoting half their lives to a specialised career that is now effectively worthless. Things like this combined with a bit of bad luck, bad health, etc. can result in people reaching retirement age with very little money at all.
reducing
Call it a deduction of $0.50 (from your benefits) for every $1 additional income you receive
Sometimes people call it the tax trap. Because you work for $1 but lose 50c in benefits even if there is no tax it is like 50% tax.
Lets say as a couple you retire with $1.03m in Super have no home. You are better off buying an $600k property and have $430k in assets and be able to get the pension. If you have $1.03m in assets you get no pension.
Yeah people is going to moan about why should you pay a pension to someone with $1.03m in assets but then why should government pay rent assistance to someone who retire with $430k of assets and not paid off house. Some people have $600k houses and other people have $2m houses but what did they do to get that? Choose somewhere to live and all the speculators did the work.
All New Zealanders at age 65 receive a universal pension regardless of wealth. $1000 for singles $800 for couples per fortnight.
Oh, and you can earn up to $300 per fortnight too before your pension is recalculated.
Hold on a minute.
That would imply a kind of fairness regardless of wealth and race. That is too much for this country.
We need to complain about what people have. If they live in a $2m run down 2BR weatherboard it isn't okay but if they live in a $300k weatherboard then it is okay and how could they not have chosen a house that would appreciate to $1.7m
That's the stupid thing, people whine that pensioners may have a house worth $2m, but the value of the house is irrelevant to them, as it's their home that they've lived in for years.
Means tested benefit?
This sounds like a homework question:)