Ask Paul: I've been a carer for 20 years and only have $264 in super

Hi Paul,

I'm 61, own my home, have no debt, only $264 in super, and have about $100,000 from an inheritance.

It's only been a year since I lost my mum who had dementia. I cared for her for 20 years and I'm still grieving; it's a huge adjustment.

I was on a carer's payment at the time, but now I'm on JobSeeker and it's a big drop in money. 

In terms of retirement, I would just like to be happy in my home and to be able to pay bills. My life has slowed down considerably since losing my mum. 

I have too much stuff, I would like to clear it out.

As for working, I guess I would probably like it more than I think. The past 20 years were for Mum. I don't think I've worked for about 30 years.

At the moment, I don't feel ready. My mum wasn't a big spender but I was the opposite and she would help me out whenever I needed.

I'm the same with my adult son. I just can't say no. He is living with me at the moment and not working. He gives me $200 a fortnight. 

I would love some guidance about my next steps. - Ruby

My commiserations, Ruby.

I can feel in your words how much you loved and cared for your mum.

She was lucky to have you caring for her and I can see how much you miss her.

Inheritance and JobSeeker

Let's look at the impact of your inheritance on your JobSeeker payment. As you know, this is tested under the income and assets test.

A single person with no children can earn up to $150 per fortnight before the payment is impacted. So if your inheritance was invested in a safe and secure term deposit at today's rate of about 5%, you would be earning a very handy $5000 a year, without it affecting your JobSeeker payment.

Then we look at your situation under the assets test. The key issue is that your home is an exempt asset, so it is only the $100,000 and any other assets you own that count.

These do include a car, contents of your home, jewellery and so on. But please remember it is the value of your personal stuff today, meaning what could you sell it for. I would suggest that older furniture and house contents for any of us would not fetch much if sold. That is the value you would look at.

I don't see your assets being a problem. You would lose your payment if these, not including your home, exceed $321,500, the limit for a homeowner.

I know the payment is less than a carer's payment, but that is fair enough. But do remember that, as a person older than 55, you will get an increase from $789.90 to $852.80 after you have been receiving the payment for nine months.

Mutual obligation

Also, after age 60 the job test requirement that you actively search for work ends.

You don't need to search for work, but there is a 'mutual obligation' that involves a 'combination of paid work, approved voluntary work or study totalling at least 30 hours per fortnight'. If a suitable job is found for you, you must attend the job interview.

Frankly, Ruby, until people reach age-pension age, which is a more generous payment, I can't disagree with the idea of mutual obligation. But goodness, it is pretty generous in its vagueness.

Volunteering and upskilling

It seems to me that if you were to consider work in the future (I appreciate and understand it is too soon since your mother's death for you), you may find that 15 hours a week of volunteer work may be a good way to broaden your friendships after losing your mother.

Some approved study may also add to the quality of your life.

I know if I had a little more time, some study to improve my computer skills would be fantastic!

I don't think you have a lot to be concerned about when it comes to reporting your $100,000 inheritance. You are well below the income and assets test limits. I also don't see the 'mutual obligation' requirements as much of a hindrance. In fact, you may find that this allows you to start rebuilding your life without your mum.

With your super of $264, I'd suggest you check with your fund that fees and insurance are not being deducted, or it will soon have a zero balance. As a zero or very low taxpayer, I don't think super is particularly important to you right now. But if you do choose to work in the future, I would like you to reconsider super at the time.

Decluttering the house

Clearing out your house is a terrific idea.

One thing I do know, after 40-plus years working with people and their money, is that things get harder as we age. I can certainly vouch for this: at age 70 I creak as I get out of bed and am pretty useless until I have a coffee. I also don't mind a quick afternoon nap!

You mentioned you are slowing down, so I'd suggest you make a plan. I find the less I do, the less I get done. It may not work for everybody, but I like to have a few simple goals. I should say one of these goals, like you, is clearing out the stuff that builds up over life. That alone is a good goal.

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