Planning for end-of-life expenses can be challenging, but understanding the support available from Services Australia can help ease the financial burden on your loved ones. Here’s an overview of the assistance provided to pensioners concerning funeral costs.
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Bereavement Payment for Partners
If your partner was receiving a pension or income support payment, you might be eligible for a bereavement payment to help you transition to a single income. To qualify:
- Both you and your partner must have been receiving an income support payment or a pension for at least the previous 12 months.
The bereavement payment is typically a lump sum equal to the combined couple rate of your payments minus your new single rate, calculated over a 14-week period starting from the day your partner died.
Pension Bonus Bereavement Payment
If your partner was registered for the Pension Bonus Scheme and passed away without claiming their bonus, you might be eligible for the Pension Bonus Bereavement Payment. This tax-free lump sum is designed to support the surviving partner. To qualify:
- Your partner must have died on or after 1 January 2008.
- They were a member of the Pension Bonus Scheme for at least 12 months.
- They met the required work test for the scheme.
- They did not claim the Age Pension or Pension Bonus before their death.
- They did not receive any income support payments (except for Carer Payment) since qualifying for the Age Pension.
You must submit your claim within 26 weeks of your partner’s death. For detailed information on eligibility and the application process, visit the ‘Who can get it?’ section of the Services Australia website.
Funeral Payment Support for Carers
If you were receiving the Carer Payment for someone who has died, Services Australia provides continued support to help you transition. You may continue to receive the Carer Payment for up to 14 weeks following the death. Additionally, depending on your circumstances, you might be eligible for a lump sum bereavement payment. This extension allows you time to adjust and explore other income support options if necessary.
Prepaid Funerals and Funeral Bonds
Investing in prepaid funerals or funeral bonds can be a strategic way to manage your assets. Services Australia generally exempts these investments from the assets test, which can help maximise your pension entitlements. Key points include:
- Prepaid Funerals: Funds used to prepay your funeral expenses are not counted in the assets test, regardless of the amount.
- Funeral Bonds: Investments in funeral bonds up to a certain limit are also exempt.
It’s important to note that if you have both a prepaid funeral and a funeral bond, only the prepaid funeral is exempt, and the funeral bond becomes assessable. For comprehensive information, refer to the ‘funeral bonds and prepaid funerals’ section of the Service’s Australia website.
Tips for Managing Funeral Costs
While funeral payments can ease the financial burden, it’s still wise to manage expenses carefully. Consider the following tips:
- Compare Funeral Providers: Costs can vary significantly, so obtain quotes from multiple funeral service providers to find the best value.
- Consider Simple Services: Opting for a smaller service, direct cremation, or private burial can significantly reduce costs without compromising dignity.
- Seek Community Support: Charities such as the Salvation Army and St Vincent de Paul Society may offer additional assistance for low-income families.
- Explore Government Resources: Some state governments provide additional bereavement or funeral assistance schemes. Check local programs for eligibility.
- Plan Ahead: If possible, consider setting up a pre-paid funeral plan or funeral bond to ease the burden on loved ones in the future.
Where to Get More Information
For detailed guidance and assistance, visit the Services Australia website or contact your local Centrelink office. The Centrelink bereavement line is also available for immediate support. They can provide personalised advice and ensure you access all the support available to you. Additionally, community legal centres and financial counsellors can help clarify your rights and entitlements.
Final Thoughts
Understanding the available support and how your assets are assessed can significantly impact your financial planning for end-of-life expenses. For personalised advice, consider contacting Services Australia’s Financial Information Service or consulting with a financial advisor to ensure you make informed decisions tailored to your circumstances.
We are also here to help and answer any questions you have.
If you need a quote to submit to Centrelink, please fill out our funeral expenses quote form.
