In this episode Justin Bott Financial Information Officer from Services Australia explains how downsizing, moving into a granny flat, a retirement village or aged care might affect your government entitlements.
As always, getting financial advice and discussing your plans with family members is an essential step before committing.
For example, moving into a granny flat on your son or daughter’s property may seem like a good solution, but there may be effects on your pension if you have more assessable income as a result of your house sale. You must also think about what it means for your will.
A big issue in a granny flat arrangement what happens if the family moves, or there’s conflict – what is the longer-term picture beyond the immediate solution?
Retirement villages require an up-front lump sum as a right to live there for the rest of your life, or in some cases, you can buy the property. Either way, you will have ongoing costs that need to be factored in. You are paying the money to live in the community and have a social connection, but Justin Bott advises you to think about whether you will use the facilities, what sort of interests do you have in retirement and whether your needs will be met.
You can call Services Australia Older Australians line on 132300 to speak to a financial information officer, who can’t give individual advice, but they can tell you how your accommodation plans might affect your pension and assessable income.