Australia’s pension policy changes starting September 20, 2025, influence how retirees, whether current or future, plan their retirement. While the pension eligibility age is still set to age 67 for those born on or after January 1, 1957, important changes to payment rates and policy thresholds will come into effect helping retirees address their standard of living and cost of living concerns.
New Age Pension Payment RAtes
Effective September 2025, Age pension will see its highest incremental payment. Pensioners living alone will receive $1,178.70 while couples will receive $1,777.00 combined ($888.50 each). This will come to $30,646 for singles and $46,202 for couples annually. These increases help pensioners address the rising cost of living. This is also a welcome policy shift as it will, on most occasions, help address inflation.
No Increase to Age Eligibility Age
At the moment, and currently available public policy documents suggest there is no plan to increase the age of eligibility to the Age Pension past 67. For those born after January 1, 1957, they will still qualify age 67. Speaking to policy intent, there has been no advocacy to lower the age back to 65.
Changes to the Means Testing
The means testing which governs pension eligibility has also had some changes. The asset threshold is larger, which means more retirees can receive payments. For single home owners, the threshold is now $714,500. For couples, it is $1,074,000 combined. The income limit also increases, with singles being able to earn $2,575.40 every two weeks before they lose qualification.
Deeming Rate Changes
Policy changes also include the changes to deeming rates which Centrelink uses to determine income from saved finances, shares, and super balances. From September 2025, the lower deeming rate is 0.75% and the upper rate will be 2.75%. This will change the way Centrelink assesses whether or how much pension will be paid, thus affecting retirees with large asset bases.
Retirement in Australia
Most will still retire around the traditional age, but more and more Aussies keep working well past 67, especially in high-skilled jobs. Demographic changes display that 1 in 4 men are working at 70, which is also a sign of retirement norms changing to be more flexible, in conjunction with the longer and healthier lives.
Frequently Asked Questions
Q1: Did the pension age rise in 2025?
No, the eligibility age remains at 67 for those born on or after January 1, 1957.
Q2: What are the 2025 pension payment rates?
Singles receive $1,178.70 per fortnight; couples get $1,777.00 combined.
Q3: Are there new asset and income thresholds?
Yes, new thresholds allow higher limits before disqualification—$714,500 for singles and $1,074,000 for couples.
