“I need to wait until I am 67 to retire.”

I hear this statement often “I need to wait until I am 67 to retire”. Depending on one’s individual circumstances, this might not be the case and is dependant on what you are trying to achieve. I hear this a lot due to 67 being the age where if someone is eligible for the Centrelink Age Pension -they can claim it.

No Social Security

First, not everyone is going to be eligible for the Age Pension due to assets or income being above the limits. So, working until age 67 because you have heard it through “the grape vine” is not usually necessary.

However, it is always a question of in retirement what income do you need (your living expenses)? Then working backwards from there on how you will get that income.

Provided you are over the age of 60, you can access any accumulated superannuation to help start “living off of it” if you retire. With this income from your superannuation, you may be able to support your living expenses, or you may have other assets outside of your superannuation like an investment property with rental income you can use.

If you are retiring prior to age 60, it is important you have sufficient assets outside of superannuation to sustain your living expenses, knowing that at 60 you can then access your superannuation if you still meet the retirement condition of release.

Social Security

If you are needing to rely on social security to meet your living expenses (along with some superannuation also maybe). It is important to remember the age pension isn’t the only Centrelink entitlement you may be eligible for. There are other entitlements prior to age 67 such as the disability support pension or the JobSeeker entitlement that you may be able to claim.

Entitlements such as the JobSeeker entitlement post age 60 and prior to age pension age of 67 can be claimed provided you meet the eligibility criteria and meet the mutual obligation requirements. These usually involve actively looking for work but once over the age of 60 the rules are a bit more lenient and, in some circumstances, – Centrelink will allow you to volunteer 15 hours per fortnight to meet these requirements.

As an example, the payment rate is close to the age pension payment rate, with the full entitlement for JobSeeker for a member of a couple is $706.20 p.f. currently versus the age pension which is $841.40 p.f. at the time of writing.

Summary

Everyone’s situation is different and I am just trying to highlight generally pre-retirees have goals and working to a certain age I don’t feel is a “goal” but sometimes what people think they “require”. It is important to review your individual situation because there may be more than one way of achieving your “ideal/close to ideal” retirement outcome.