age pension

Financial literacy is a vital part of navigating today’s complex financial world. However, despite the importance of financial literacy, certain socio-economic groups have been consistently left out when it comes to receiving financial advice. Low income clients are a major group which have traditionally been excluded from the advice process. This is partly due to barriers such as cost and access to affordable advice, but also due to issues such as an industry focus on high-net-worth clients.

As the Australian population continues to age, there is expected to be greater pressure on all areas of society, particularly income support, health and aged care. With many retirees expected to reconsider their accommodation requirements, financial advisers are likely to be faced with greater demand for information on alternative living arrangements. Granny flats are a popular form of aged care accommodation, with a number of social and economic advantages.

Over the next 40 years, the number of Australians aged 85 and over will more than quadruple — from around 400,000 in 2010 to 1.8 million by 2050, according to the Federal Government’s third intergenerational report. (Australian Government, 2010) This ageing population means more and more retirees will have to consider their living arrangements for the next stage of their life. As a person’s home has a huge impact on their health and happiness, it is essential all options are taken into account.

With over 4 million Australians currently receiving income support benefits of one form or another from the Federal Government (Government), an understanding of how the system works and how clients can legitimately maximise their entitlements becomes a vital element of the financial planners’ expertise.