The Age Pension and Your Investments: How They Interact in Australia
Last updated 5 May 2026 · General information only
The Age Pension is means tested, which means what you own and what you earn both affect the payment. Understanding the mechanics helps you avoid surprises.
Two tests, lower result applies
Services Australia applies an income test and an assets test. Both are calculated, and the one that produces the lower payment is the one that applies. Passing one test is not enough on its own.
The assets test
Most things you own count: super in pension phase, savings, shares, investment property, vehicles and household contents at their second-hand value. The family home you live in is generally exempt, though there are limits related to land size in some cases.
Above a threshold, the payment reduces at a set rate for every additional amount of assets. Thresholds differ for singles and couples, and for homeowners and non-homeowners.
The income test and deeming
Rather than measuring the actual return on your financial assets, Services Australia applies deeming rates — an assumed rate of return. If your investments earn more than the deemed rate, the extra is not counted; if they earn less, you are still assessed on the deemed amount.
Gifting and the five-year rule
Giving money away does not automatically reduce your assessed assets. Amounts above the allowable gifting limits continue to be counted for five years. This catches many families by surprise when helping children.
Concession cards and extras
Even a small part pension can bring access to the Pensioner Concession Card and related benefits. For some households, the value of those concessions is a meaningful part of the total.
Frequently asked questions
Is my home counted?
The home you live in is generally exempt from the assets test, though homeowners face lower asset thresholds than non-homeowners.
What are deeming rates?
An assumed rate of return applied to your financial assets for the income test, regardless of what they actually earn. Services Australia publishes the current rates.
Can I get a part pension?
Yes. Many retirees receive a part pension, which reduces gradually as income or assets rise rather than cutting off abruptly.