How much Age Pension you are entitled to depends on the level of assets and income you hold. If your assets and income are both below the minimum threshold, set by the government agency Services Australia, you qualify for the full Age Pension. If you go above these limits you receive a part Age Pension until you reach the maximum threshold, when no Age Pension is payable. Both tests are calculated and whichever results in the lower Age Pension applies.
To help keep pace with inflation, the government indexes the maximum Age Pension amount and the income and asset thresholds twice a year. The latest increase took effect from the 20th of September 2026 and as a result, Age Pensioners will receive up to an additional $36.80 per fortnight for singles and $27.80 per fortnight per member of a couple.
How a KeyInvest Funeral Bond can help
As Funeral Bonds are a sole purpose fund and cannot be accessed before death, with the proceeds applied to funeral expenses, investing up to $16,250 into a funeral bond is generally not included when calculating Age Penson entitlements[i].
Assets Test
For those impacted by the assets test, a $16,250 exempt funeral bond results in up to an additional $48.75 per fortnight ($1,267.50 p.a.) in additional Age Pension. This combined with the general increases from 20 September can result in an additional $85.55 per fortnight ($2,224.30 p.a.) for singles or $76.55 per fortnight for each member of a couple, an additional $3,980.60 p.a. combined (where each member holds their own $16,250 funeral bond).
Income Test
For those most impacted by the income test, there is good news and bad news. On the one hand the government is giving an increase but with the other hand taking away due to a 0.50% p.a. increase to the rate your financial investments are deemed to earn interest[ii]. Services Australia does not use the actual interest earned on your financial investments but “deems” it to earn interest at the deeming rates they set. An exempt $16,250 funeral bond can help ease the pain with a benefit of up to $11.71 per fortnight ($304.46 p.a.). Where each member of a couple holds their own funeral bond up to the $16,250 exempt amount, the couple can benefit by up to $23.42 per fortnight ($608.92 p.a.) combined. With higher costs of living even this smaller benefit, compared to that under the assets test, can make a difference.
If you already have a Funeral Bond, it may be time to check with your Adviser or Funeral Bond provider to see how much of the $16,250 allowable limit you have currently used and the amount of additional contribution you can make.
If you want to know more about the KeyInvest Funeral Bond, please contact our Investor Services Team on 1300 658 904.