Overnight, the Federal Government handed down its annual budget.
It contained the following key points related to retirement planning:
- further increasing Age Pension age to 70 by 1 July 2035
- indexing pensions to CPI, rather than wages, from 1 September 2017
- resetting deeming thresholds to $30,000 for singles and $50,000 for couples from 20 September 2017
- freezing Income and Assets Test thresholds for Government pensions including Age and Service Pensions from 1 July 2017
- including untaxed superannuation income in the Income Test for the Commonwealth Seniors Health Card for new recipients from 1 January 2015.
Other significant financial planning-related items were:
- introducing a 2% Temporary Budget Repair Levy on incomes over $180,000 for three years from 2014-2015
- maintaining SG contributions at 9.5% for three years from 1 July 2014
- allowing individuals to withdraw contributions in excess of the non-concessional contributions cap from 1 July 2014
- tightening the eligibility for Family Tax benefits.
Other items were:
- Abolition of Mature Age Worker Tax Offset
- Abolition of Dependent Spouse Tax Offset
- Increasing the Medicare levy low-income threshold for families
- Seniors Supplement abolished
- Disability Support Pension changes regarding recipients time spent out of Australia
- First Home Saver Accounts to be abolished
- Higher Education Loan Program (HELP) reduction to income threshold