How $210k windfall will affect the disability pension

With an inheritance on the way, Margaret needs to know …

QI am 59 years old and receive the disability support pension while working part time. My mother recently passed away and an expected inheritance of $210,000 is pending. I have about $20,000 in super (before the coronavirus) and no savings. My major requirement is to continue the health support offered by the disability pension. Could you guide me as to how to invest the money, please?

The inheritance will be a great boost to your financial situation, Margaret. First, let’s look at the impact on your pension. The $210,000 plus your $20,000 will not impact on your pension under the assets test whether you are single, in a relationship or a homeowner. It is below the limit.

Under the income test, again it depends on your single or partnered status and whether you are a homeowner. Here it gets a little more complex. Naturally, your part-time income may already impact your pension. With your inheritance, regardless of what you do, as of May 1, 2020, you will be deemed to be earning 0.25% on the first $51,800 and 2.25% on amounts above this if you are single.

As you can see there are quite a few variable here. This is quite a complex area and I really think you need some professional, personal advice. Centrelink can help you with the impact of the money on your pension, based on your personal circumstances.

With your money, it is important you invest it safely, but with a reasonable return. Check with your bank – it may have a special pensioner deeming rate account. Looking online, I can see a couple of good pensioner rates, with Suncorp at 1.8% and Ubank at 1.6%.

Depending upon your superannuation situation, adding some of this money to super may be worth considering. If you have super attached to your part-time work, that is a potential source of financial advice, as most funds have a service to assist members.

Your personal situation, investment objectives and the complexity of our pension system make a discussion with Centrelink and a personal adviser pretty essential.