Starting 20 March 2025, the Australian government implemented a significant increase to the Age Pension, providing a welcome financial boost to more than two million retirees. This change is part of a biannual indexation routine aimed at ensuring pension payments keep pace with inflation and the rising cost of living. The increase reflects updated economic indicators and is designed to preserve the purchasing power of older Australians who depend on the pension as a primary income source.
Australia Age Pension Set for Major Boost in 2025
| Feature | Details |
|---|---|
| Effective Date | 20 March 2025 |
| Beneficiaries | Over 2 million Age Pension recipients |
| Single Pensioner Rate | $1,149.00 per fortnight ($29,874 annually) |
| Couple (each) Rate | $866.10 per fortnight ($22,518.60 annually) |
| Couple (combined) Rate | $1,732.20 per fortnight ($45,037.20 annually) |
| Increase Amount | Singles: +$4.60/fortnight; Couples: +$7.00/fortnight combined |
| Indexation Basis | CPI, PBLCI, and Male Total Average Weekly Earnings |
| Next Scheduled Adjustment | 20 September 2025 |
| Official Website | https://www.servicesaustralia.gov.au/age-pension |
What Changed in March 2025
Higher Payments for All Age Pensioners
Effective from 20 March 2025, Age Pension recipients saw their payments increase as follows:
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Single pensioners now receive $1,149.00 per fortnight, up from $1,144.40.
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Each member of a pensioner couple receives $866.10 per fortnight, up from $862.60.
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The total combined pension for couples is now $1,732.20 per fortnight.
These changes result in a modest yet impactful increase to help pensioners with daily expenses like groceries, utility bills, and healthcare.
Eligibility Requirements
Age
Applicants must be at least 67 years old at the time of their claim.
Residency
Applicants must:
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Be an Australian citizen or permanent resident.
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Have lived in Australia for at least 10 years, with at least five of those years being continuous.
Income and Assets
The Age Pension is means-tested. Payments reduce or cease based on your income and assets.
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Income thresholds:
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Singles can earn up to $212 per fortnight before reductions apply.
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Couples (combined) can earn up to $372 per fortnight.
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Assets thresholds (homeowners):
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Singles: up to $314,000.
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Couples (combined): up to $470,000.
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Assets thresholds (non-homeowners):
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Singles: up to $566,000.
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Couples (combined): up to $722,000.
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Other Factors
Assets include property (excluding primary residence), vehicles, bank savings, shares, and personal valuables. Exceeding income or asset limits will reduce or eliminate your pension entitlement.
How Payments Are Adjusted
The Age Pension is indexed twice a year — in March and September — to ensure payments keep up with inflation and general wage increases. The indexation formula compares the Consumer Price Index (CPI), the Pensioner and Beneficiary Living Cost Index (PBLCI), and Male Total Average Weekly Earnings (MTAWE), using whichever provides the highest benefit.
This approach ensures that pensioners don’t fall behind financially, especially during periods of high inflation.
Deeming Rates Explained
Deeming rates are used to assess how much income pensioners earn from their financial investments. These rates are unchanged in 2025:
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For singles:
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First $62,600 is deemed to earn 0.25%.
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Amounts above that are deemed to earn 2.25%.
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For couples (combined):
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First $103,800 is deemed to earn 0.25%.
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Amounts above that are deemed to earn 2.25%.
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These deemed earnings are included in the income test calculations.
What You Need to Do
Current pensioners do not need to take any action. Adjusted payments are automatically applied to accounts. However, if your circumstances change — including your income, assets, or marital status — you are required to notify Centrelink to ensure your payments remain accurate.
New applicants can apply online through their myGov account linked to Centrelink, by phone, or in person at a Services Australia service centre.
Frequently Asked Questions
What is the Age Pension increase for March 2025?
The pension increased by $4.60 per fortnight for singles and $7.00 per fortnight for couples combined.
Who qualifies for the Age Pension?
You must be 67 years old or older, meet the residency requirements, and pass income and asset tests.
How often are pension rates adjusted?
Twice a year — on 20 March and 20 September — through automatic indexation.
Do I need to apply for the increase?
No. If you are already receiving the Age Pension, the increase is applied automatically.
Can I still work and receive the Age Pension?
Yes, but your earnings will be counted under the income test. If you exceed income limits, your pension may be reduced.
What if I exceed the asset threshold?
You may receive a reduced pension or none at all, depending on the value of your assets. It’s important to report any changes to Centrelink.
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