Can I receive the Aged Pension if I retire overseas?

We receive a large number of emails and calls from people every week concerning accessibility to the Australian Aged Pension, if they were to retire overseas. And even though a number of them may have already spoken to Centrelink, there still remains much confusion about the topic. So we felt it was time to get the message out loud and clear.

YES! YOU CAN RECEIVE THE AGED PENSION IF YOU RETIRE OVERSEAS

There are estimated to be between 50,000 and 60,000 Australians living overseas and still receiving their Aged Pension entitlements. This is actually a very low number when you consider there are around 2.4 million Age Pension recipients in Australia.

To put this into further perspective, only about 1 in every 50 Age Pensioners are currently living overseas., but we believe this figure will rise considerably over the coming years for three main reasons;

Currently 28% of all Australians were born overseas, and a further 20% had at least parent born offshore. Many are already returning to their original home to retire surrounded by their extended family and old friends .
Our close proximity to Asia. The countries to our immediate North offer a relaxing lifestyle, full of exciting possibilities, at an affordable price. Plus as we have discussed in previous blogs, flying back to Australia is getting cheaper and easier.
Many South East Asian countries are actively seeking retirees from countries such as Australia. They are broadening and enhancing their retirement visas, and marketing themselves increasingly has highly desirable retirement destinations.

Centrelink

For those of you who seek further confirmation of your accessibility to the Aged Pension, our advice is to speak with Centrelink’s ‘Financial Information Service’ (FIS). It’s a free service that provides education and information on financial issues for all Australians. They are part of the department which administers the Age Pension, and can be found on the following link;

What are the rules?

The main points are as follows;

You must have been an Australian resident for a total of 10 years, with 5 of those being continuous.
You must pass the Age Pension Income and Assets tests.
You must be in Australia when you apply (or residing in a country with an International Social Security agreement with Australia).
You must have lived in Australia permanently for 2 full years ‘around’ the time that you apply.
If you have not been a resident of Australia for a minimum of 35 years between the ages of 16 and the Pension Age, the payment will be pro-rated. For example, if you have been an Australian resident for 20 years, you will receive 20/35th of your full pension entitlement if you retire overseas.
You will lose the small pension supplement payments that go along with your age pension payment.

Conclusion

We understand planning for retirement can be confusing. When you are also considering a new and exciting lifestyle overseas, this can add another layer of complexity. Its therefore very important to get good advice, and ensure you receive all your entitlements and remain firmly within the rules. Then you too can join the tens of thousands of Australian’s living the dream overseas AND receiving the Age Pension.