The Best of 2022
Being sick is no fun, completely losing the voice because of it, is even worse. This is why today’s video is different and I am not in it, but I wanted to use this “quiet time” to provide you with the most important clips of the last 12 months, information that most viewers found the most important or interesting, questions that others asked and issues to asked me to discuss or explain.
The most important changes of 2022: Proposed Super Changes in 2022
As originally introduced in the 2021-22 budget – you can read my full Federal Budget 2021-22 article, there have been number of recommendations made by the government to be introduced from 1st July 2022 and they include:
1. Expansion of the First Home Super Saver Scheme
to allow eligible first home buyers to release up to $50,000 of their superannuation to purchase a home, up from $30,000
2. Abolishing the work test for retirees – big benefit for retirees.
if you are aged between 67 and 74, you will be able to top up your super without having to satisfy any test providing that your super fund’s value is less than $1.7 million in July 2022.
3. Expanding the Downsizer Scheme
allows eligible people who sell their home to make a one-off, $300,000 contribution to their super, outside the concessional and other rules. Couples can contribute $300,000 each.
4. Removing the $450 minimum income threshold for super contributions
Under the change, from 1st July 2022, employers will be required to pay the superannuation guarantee on the wages of employees’ earning less than $450 per month.
Question: Which of these propose changes to superannuation rules took effect in 1st July 2022?
The most watched video: 9 ways to hide money from Centrelink
Let’s discuss 9 ways how you can legally hide your assets, to improve your Age Pension position.
1. Gifting
You can give away a maximum of $10,000 in one financial year up to $30,000 within a period of 5 years.
2. Home exemption
Home is just about the only asset that regardless of its value, is fully exempt from the Assets Test, up to the first 2 hectares of land it is on.
3. Renovate your home
Any money spent to improve your home or repair it, will become part of its value, therefore exempt from Centrelink tests.
4. Repay debt against exempt assets – pay off your home loan
The reason is that your mortgage continues to charge you interest (your loss) and you have to meet ongoing repayments.
Question: What are the other 5 ways mentioned in my video?
The most controversial video – Changes for retirees under Labor
I will give you 4 election proposals introduced by the Labor Party that are to be introduced very soon and I will explain what impact those proposals will have on your retirement.
1. Freezing of Deeming Rates
Freezing deeming rates for a period of 2 years until 2024.
2. Increasing eligibility for the CSHC
Will allow an extra 50,000 Australians aged 67 or older to gain access to this valuable card.
3. Extending the exemption on home sale proceeds
Extend the 12 months up to 24 months, giving pensioners more room for those big changes as home downsizing.
4. Cutting the cost of prescription medicine
Given that older people are more likely to use more medication that young people, obtaining medication that is included in the Pharmaceutical Benefits Scheme is very beneficial, as cost of such medicine has been significantly reduced.
Question: What was the reason for controversy?
The most popular video in 2022: How much income do I need in my retirement?
When you are preparing for retirement or retired already, one of the biggest questions is – How much income do I need in my retirement?
And then the second question should be – How do I get that income?
According to AFSA (Australian Financial Security Authority)
The modest lifestyle means – you can cover all your bills, you have sufficient income for food and basic emergencies, but not really to have comfort of overseas holidays or buying big presents for your grandchildren.
Then to have a “comfortable lifestyle” which covers those extras, AFSA estimates a retired couple needs an income of $62,269p.a.
If we look at income needs for a single pensioner, AFSA says that a “modest lifestyle” can be achieved with $28,165 and to have a comfortable lifestyle a single person would need an income of $44,146p.a.
Question: What is the level of income the couple needs to have to reach a comfortable lifestyle according to AFSA?
Retirement is a Journey, not a Destination, so be well prepared for the Ride.
By: Katherine Isbrandt CFP®
Money Strategist & Retirement Planner
Principal of About Retirement
