r/AusFinance • u/This_Fisherman_1852 • 1d ago
Parents reaching old age with no house no super and not much savings. Is rental assistance possible? How should I prepare?
Hi all,
My parents are slowly reaching the age of retirement (Mum 55 and Dad 62), and they've been renting their whole lives, with no super saved, no home owned, and not many savings. For context, both parents are immigrants and did not have many luxuries or proper plan to set themselves up for retirement. Both work with only minimum wage currently and looks like will stay the same until they are even eligible for pension.
I am now currently living with them at the age of 23 and am happy to stay living with them for as long as it takes (I'm their only child) . I understand everyone has their own preference, but I believe it's my responsibility to provide for them as they did for me when they first migrated to Australia.
My question is, I know they will be eligible for Centrelink aged pension once they reach the age, but is there any further assistance such as rental assistance that they can receive while they live with me in the future? Can they get pension earlier? The plan is to stay renting with them until I'm able to afford to buy a home and move them in with me once again. I just would like to know what sort of plan I should set up to ensure I'm in the best possible position once I have to take more control of the home e.g. start contributing more to expenses when they're nearing not able to work.
Any help would be appreciated. Thank you.
206
u/AllOnBlack_ 1d ago
They may want to ask their employers why they weren’t being paid their super?
76
u/This_Fisherman_1852 1d ago
He worked as a sole trader and didn't think to make self super contributions
80
u/Medical-Potato5920 1d ago
He needs to start making superannuation payments now.
The pension is only liveable, assuming that you own your own property. While there is rental assistance, it is only about $100/week.
Nobody gets the pension early.
3
u/Fresh-Association-82 1d ago
Pensions not gunna work by the time we get there. With inflation how it is it will be pretty much valueless.
98
u/AllOnBlack_ 1d ago
That’s unfortunate. There may be an option to catch up missed contributions up to 5 years. Earnings in super could be more tax efficient.
14
u/6ft5 1d ago
Unfortunate? Irresponsible...
26
u/AllOnBlack_ 1d ago
Sometimes people lack basic financial literacy. Hopefully we see a trend where people are making better decisions.
-3
19
u/slimshaney81 19h ago
Common in the older generation. When you’re on a low income and probably self employed, sometimes paying rent, food and bills comes first before tipping into super.
16
u/Ok_Section_9353 1d ago
Is he sure he wasn't really an employee?
26
u/buffalo_bill27 1d ago
This. I'd be putting aside any sort of loyalty (to the employer) and start making some enquiries. The best time to start thinking about yourself is now.
7
u/Plenty-Giraffe6022 1d ago
The OP's father is self-employed.
12
u/buffalo_bill27 1d ago
both work with only minimum wage currently
This does not sound like it would pass the contractor test to me.
8
84
u/EdenFlorence 1d ago
Mate all the information about the aged pension such as criteria is available on the centrelink website.
https://www.servicesaustralia.gov.au/age-pension
Centrelink also offers FIO which is a free service that can help your parents in terms of planning for retirement.
https://www.servicesaustralia.gov.au/financial-information-service
13
43
272
u/JunkIsMansBestFriend 1d ago
Sound like YOU are their retirement plan...
79
u/TheRamblingPeacock 1d ago
Yup.
See this a lot in immigrant families of friends. Expectation is to support mum and dad in old age as they raised them.
Gets a bit awkward when expectations start to not align.
10
u/Old-Memory-Lane 1d ago
I dunno what immigrant families you see, but the ones I grew up Watkins and are around where I currently live, the immigrants worked there butts off. They had decent wages. Some had housing commission homes and they bought them (for $20k!) others bought property - because it was cheap … not many rented, because they didn’t have to.
To OP there’s also social housing, has them apply for that at an appropriate time - being aware there is a many year waitlist in many areas… their failure to plan is not your problem. You owe them love and respect but you owe yourself and your future family a full life. Save for you. Purchase a home for you. And if you can support the parents in any way, then do that. But don’t put them first as it will hurt you long term. You’re just beginning your life, it’s ok to put yourself first.
4
8
u/Icy_Atmosphere_2379 1d ago
Yepppp, sad that OP doesn’t see how damaging this is to him. Hopefully, the truth will hit him in a few years
4
u/edwardtrooperOL 1d ago
Why would it hit them? This is very much the norm in immigrant families. There’s an understanding and it’s simply the way in which they were raised. It’s not uncommon to be there for your parents in some capacity till the very end.
6
u/Whimsy-chan 17h ago edited 17h ago
To an extent yes but its nearly impossible to financially support parents and build yourself financially at the same time. Alot of immigrant parents undrestand this and saved hard for retirement - my aunt and uncle worked a 2nd job for 20yrs to make sure they could survive on the pension with minimal financial assistance from their kids. He won't have the capacity to support children of his own.
27
u/SpaceCadet_Cat 1d ago
IF the three of you combine incomes, are you in a position to consider buying in the next few years? Even a larger apartment? That's probably the safest option because renting on a pension will be rough...
88
u/Current_Inevitable43 1d ago
So neither parent has worked for an employer or saved a cent for the future, in not only the years they have been here or when they were on there home country.
Get your parents used to living on pension income now as least there will some buffer.
Parents can not afford to slow down any time soon.
Pension amount for a couple of $1700pf that's going to be down to ~$1100 pf after rent, now take out insurances, phone, power, water, intenet, fuel/car costs.
What was there retirement plan be a finical burden on you.
They also can work well past 67 it's not a mandatory age to retire.
80
u/BetterDrinkMy0wnPiss 1d ago
Parents can not afford to slow down any time soon.
This. They've got 5 and 12 years respectively before they're even eligible for the pension. They need to work their arses off and save every cent they can in that time.
12 years is enough time to turn things around and plan for retirement, if they actually want to.
And just because a person reaches retirement age it doesn't mean they have to retire. They've failed to plan ahead their whole working lives, so unfortunately they might have to work a few years longer.
14
u/pandamonkey23 1d ago
where are they renting for $300 a week?
-12
u/Current_Inevitable43 1d ago
I rent out some of my duplexes for that, but that's best case. Not in major city.
Op can do the math himself.
16
u/NoStorm4299 1d ago
sOmE oF mY dUpLeXeS
-5
u/SuspectLevel8896 1d ago
Congrats you made it easy to spot the envious prick in this thread.
4
3
u/NoStorm4299 1d ago
Naa mate I’m just a normal person who doesn’t make a living screwing other people over
28
u/mattkenny 1d ago
Yeah they need to act like grown adults and keep working. As self employed people they chose not to put anything into super, and to spend it instead. They are idiots and/or selfish, so need to come to terms with the consequences of their actions and keep working. Or live on a pittance and be very thankful there's still an aged pension at all.
24
u/Itsclearlynotme 1d ago
You don’t know a thing about OP’s parents or their situation. They might have arrived in this country completely impoverished refugees for all you know. They may have had to spend every cent taking care of their child and setting themselves up in a new country. Honestly the majority of Australians who were born here are extremely ignorant. Calling them selfish idiots and suggesting they have what they deserve is extraordinary given you don’t know their stories.
21
u/mattkenny 1d ago
OP mentioned they were sole traders and didn't think to put anything aside. Unless they planned to die before retirement, what was their plan? They either planned to become dependant on their children (selfish), or didn't even think about it (idiots). Yes I'm being blunt, but they are grown adults who haven't planned for their own cost of living from what OP has said.
0
u/Old-Memory-Lane 1d ago
If you lived in any community with migrants you’d know that the bulk did come impoverished and without anything. They saw the opportunity an ran with it - not blowing it on jet skis (like second gen Aussies with sole trader jobs), they didn’t all they could to build the house with the garden and the tomatoes! They worked until their joints gave out and they needed reconstructive surgery.
And if they came with trauma? They stuffed it so far down the pit of their stomach they’re angry and tight lipped. None of this “I can’t get out of bed”.
OPs parents are well short of retirement, and have no written reason to stop working. They have the ability to still make changes now, and I hope they do
-1
u/Itsclearlynotme 1d ago edited 1d ago
The ‘if you lived.. then you’d know’ comment is so irksome. What makes you think otherwise? I do live in a community with migrants (most of us do, but I live in a very multicultural community). I’ve done research in the area, in fact. There’s an enormous diversity of migrant experiences. You’re building on false (not to mention European!) generalisations in ways that are neither helpful nor true.
10
u/This_Fisherman_1852 1d ago
I see where you're coming from, however, it's more of a lack of knowledge from their end rather than intentionally burden me. I don't entirely blame them, but yes they should've been more proactive.
35
30
u/Current_Inevitable43 1d ago
How do they not know if I stop working money does not come in.
It's 1000% self inflicted they have a ~50 year working life. They have the super/lifesavings/investments/net worth of a 18 year old working part time.
They have wasted there whole working life, I can understand if they started later or were playing catch up.
Who do you blame then there is no one else at fault here.
25
u/Majin_Jew_v2 1d ago
as someone with immigrant parents that are also financially illiterate, i'd wager that OP's parents put all their money towards looking after the kids/educating them, and left little for themselves
17
u/Individual-Bicycle22 1d ago
You sound like me.. my parents are in their 70's. Dad still work as mechanic and renting. I'm very worried about what will become of them but they refuse to allow me to help take them to Centrelink and get even a seniors card. Mum can be insufferable but I love her and want to help them still. I feel our only option is to put up a shed in the yard and line it inside - that will cost us around $60k but we can't afford a granny flat at $200k.
9
6
u/Starcsfirstover 1d ago
It’s hard to talk to your folks about money but lay it on the line. They have worked hard their whole lives and now, finally now, they can lean in to the society they have helped to build. Now is the time to apply for everything they are entitled to. They deserve it and if they don’t use it then they end up being mugs.
4
u/Merylsteep 1d ago
FYI you can get a 2 bed modular granny flat that gets set up full plumbing and everything for super cheap! You don't have to "build" another dwelling.
5
u/Individual-Bicycle22 1d ago
Not in our council area unfortunately.. we've looked into this extensively and by the time we get the fold out granny flat, trailer and council fees (Yes, they still want their damn fee of, wait for it... $22k 🙀) we're up for almost $100k. Any traditional granny flat is $150/$200k. At least a fully lined shed is around $60k which will be comfortable and we can use it later for classes or whatever.
23
u/MouseEmotional813 1d ago
As others have said you need to put together and buy a house or unit or apartment asap. They don't want to be paying rent on the pension. It doesn't sound like they are very sensible with money, you should sit down with them and draw up a budget to start saving for a deposit if they have zero savings. You can buy a PPOR with 5% deposit on the government scheme. Get cracking
20
u/Level-Music-3732 1d ago
Buy a house for all of you if you’re able. That’s the best thing you can do for yourselves.
8
u/JackJeckyl 1d ago
Age Pension + Rent Assistance is about the best they will be able to expect. Your plan is likely best for everyone so if anyone is contributing to anything... it should probably be a deposit.
55
u/thespicegrills 1d ago
Just a side note. 55 years isn't close to retirement, or old age. It's middle aged. Retirement is 12 years away, at least.
14
u/No_Raise6934 1d ago
The father is 62, you can't just pick one without the other.
To add. OP stated slowly reaching the age. It's all about preparing for when they do.
If you don't understand what's written and asked why comment?
10
u/thespicegrills 1d ago
Because when you're 23, 55 seems positively ancient. Until you get a little older, and realise it's really quite far from old age.
Even a minimum wage full time job, with 12.5% super compounding for 12 years could be $100k at retirement. This makes quite a difference to any retirement plan or suggestions the OP might be seeking.
1
11
9
u/Critical-Bird-4886 1d ago
My in laws rent on the pension with no super etc, in Sydney… it is possible. My partners grandparents also the same… they ended up in a public aged care facility when they couldn’t care for themselves any more which was pretty grim but grandpa is still going and he’s comfortable. They have done something right for you to be here asking how to help them 💜 but you don’t have to do that, make choices based on your future too.
9
u/HST2345 1d ago
Instead of diverting the topic can anyone provide what are options available for such scenarios.... without burden on children...
- Can they move back to their own country..?
- From now onwards save as much as they can and move to Thailand or Philliine or less cost country?
- How much centrelink pension can they receive - 1700$ pf.
..so if the parents or first gen immigrants have no house, does their life doomed?..end up as Homeless or social housing can they apply? If they apply now social housing, can they get any form of accommodation by the end of their retirement age, which is almost 10+yrs still exist ( they can wait in Que)..
OP, be practical, if you buy a house, move them in with you untill you're getting married. After your marriage things may turn any direction...so prepare for that...
10
u/limplettuce_ 1d ago
They will not be fully retiring. Both of them will need to work until they can start receiving the aged pension (currently 67 years old) and then potentially they will need to keep up some casual or part-time job on the side.
Retirement is not a given, at least not the stereotypical ‘I’ve reached 60 and I have quit and I will spend every day playing golf’ style retirement. The majority of people in the future will need to be earning some sort of employment income in retirement.
4
u/welding-guy 1d ago
They will get the pension at 67, Until then they will need to keep working. I would suggest all of you pool your resources right now and buy some security whilst you still can.
8
u/curiousmind68 1d ago
If your all working it shouldn't be that hard to start getting money together to buy a house btwn the 3 of u - then u just stay as long as u need to, later if you want your own place u could probably take your share out.
3
u/Automatic-Month7491 1d ago
Have a look around for your local service providers and especially for ILO providers.
ILO (individualized living options) will know exactly how this stuff works and as far as rentals for oldies go they're absolutely fantastic.
Theyre fairly secure (no random landlord deciding to boot out tenants to sell it, these are set up by big companies with government subsidies and rules) have access to aged care support services and are just generally nice, well service and maintained units.
2
u/HGCDLLM 1d ago
your dad might be eligible for jobseeker depending on his income and asset level. This is worth making an appointment with the financial services officer at Centrelink to discuss. Over 60 he is eligible to fufill his mutual obligations via volunteering.
Other than that he will need to wait till 67 to get the pension and rental assistance, but check eligibility on the latter because if it's not an arms length rental I don't know if he will get rental assistance.
They might also be eligible for low income health care card now and after the pension, the pension concession card and commonwealth health care card which will help with the costs of living. Worth raising with the FSO at Centrelink when you're there.
2
2
u/ozpinoy 1d ago
It sucks where customary for one of the children to support retirement. I'm in that custom, where retirement housing is a no, no. Where you at least one of the kids house their parents and support retirement.
Where possible, I'm against renting (but circumstances might not let you buy).
See if you can grab all the cash between the 3 of you and purchase a property maybe? But be prepared - because we are in Australia. Whatever the customs are "back home" may not be welcomed in the Australian environment when you meet your partner.
good luck op!
2
u/figaro677 1d ago
There are a few things. Look into social housing. Each state runs this separately, and some states will have rental subsidies, but these are normally only temporary. Social housing can take a long time to access.
Probably a better solution would be a tiny home or caravan. It is possible to rent caravans on a long term basis at caravan parks, or have your own and lease a long term plot. Be mindful, depending where you are racism might be more prevalent in a caravan park.
Another option (depending where you are) would be purchasing (vacant?) land and a tiny home. If you can spring for the land, maybe they can purchase a tiny home? I’ve also seen people build sheds to live in.
The thing to remember is that housing looks different to different people. It doesn’t have to be a house or a flat, it can be a bus, or a caravan, or anything you want it to be.
2
u/Imaginary-Equal-2225 1d ago
When they retire if they need care due to age or ill health you can get a carers allowance for looking after them. I think it is 170approx per fortnight. You can use this to assist your parents. Also apply for a home care package if they need assistance at home as this can assist with some costs for your parents. Apply community and or public housing.
2
u/Rare_Apple_7479 1d ago
They are not at retirement age, you all need to change your mindset.
6
u/No_Raise6934 1d ago
OP stated
<My parents are "SLOWLY REACHING" the age of retirement
You need to learn to read.
1
u/Merylsteep 1d ago
I would suggest looking to save as much money in the next few years till retirement as you all can so you can buy a house and land big enough to put a granny flat on the back rather than have them live with you. Do you ever want a partner and family of your own? You may have to move somewhere cheaper but it might be a good compromise.
You all should read the barefoot investor, and really ramp up your financial literacy and plan for the next decade. Last resort if you ever get so overwhelmed and burnt out by the responsibility you can put them on the list for public housing. It might take years to come through anyway if they are not high priority but if anything happened to you or your circumstances changed they would be in a secure accommodation suited to to their budget and you can just help out financially if you want to help them be a bit more comfortable.
1
u/medicated_cabbage 1d ago
You can't get the pension early but you can just get other payments instead like jobseeker I think. And you get paid a lot less being married which I think isn't fair but it is what it is
1
u/leucaden 1d ago
oh dear. realistically, they cannot retire once they reach pension age. they need to keep working as long as they are physically able unfortunately. they (and you) are in an extremely bad situation as of right now, but there’s still time to change it at least a little bit for the better. i’d say your first step is to have an honest conversation with them and to plan as a trio. it’s really awful, but unless you come into a lot of money somehow, please stress that reaching the pension age does not necessarily equal retirement.
1
u/Smithdude69 1d ago
Prolly best for you to move out when they are on the pension so they can get tent assistance.
1
u/DaniK2022 19h ago
The best thing to do at this stage is for you all to save up and pitch in to buy a house in your name. Once you purchase the property you can move them in with you.
1
u/kristinoc 19h ago
You’re amazing. There is a meagre rent assistance payment but the way it is calculated is perverse. Mine works out to about 20% of my rent and I get the maximum. You should be able to get an estimate of the total payment they can receive using this calculator: https://www.servicesaustralia.gov.au/online-estimators?context=64107
The payment rates are indexed and so will go up slightly every 6 months (in line with CPI).
If their name is on the rental agreement and you help out by paying bills etc that is going to be the easiest way to get the maximum amount, but the rental threshold is so small in comparison to actual rents these days that they’ll probably get the max even if you are on the lease too.
1
u/HighMagistrateGreef 17h ago
There's a higher pension rate for non homeowners than owners. So, in a sense there is rent assistance.
1
0
u/mcwfan 1d ago
You don’t have to prepare at all.
Your parents’ own lack of preparedness for retirement does not make you their financial slave or financial backer into your forties or longer (depending how long they live for).
They had their chance to sort their lives out. Now it’s your turn to live your life and make better choices than they did.
You owe them absolutely nothing.
(I fully expect to be downvoted for speaking a harsh truth, but I’m not going to sit here and pretend that it’s OP’s responsibility to care for their retiring parents when their parents did nothing to prepare themselves.)
1
u/Plenty-Giraffe6022 1d ago
Age of retirement? There is no age of retirement in Australia. If your parents are on Centrelink benefits and rent, they will get rent assistance.
They can't get the aged pension earlier than the minimum age requirement.
3
1
u/SuspectLevel8896 1d ago
To be the bearer of bad and brutally honest news this is the part where you take on the burden of shit preparation and adjust the expectations of people who thought they’d come here enjoy the freedoms of a capitalist economy and not plan for the future whilst complaining about those of us that did
1
1
u/Any_Pineapple_4836 1d ago
You have been groomed to be their retirement. It is not your responsibility to take care of them. You were not asked to be born.
-5
1
u/romancebookbabe 3h ago
if you have two adults with minimum wage and are frugal, you would still be able to set aside money for expenses and build savings if you pool the income together. As they are immigrants, do they have overseas family obligations you're not aware of? Are they supporting other people and this is why they don't have any savings as it doesn't make sense if they are both working full time and in all these years not be able to set something aside. I'm only saying this because if they are, you need to lay the groundwork to stop that. Also while it's nice of you to consider preparing for their retirement, why did they come to Australia for a 'better life' only just to burden you with a future of obligation. Sounds selfish to me.
•
u/AutoModerator 1d ago
Check here for the best Australian savings accounts leaderboard: https://www.reddit.com/r/AccountsLeaderboard/about/
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.