Part 1 of our editorial series: ‘Your Pension, Your Future’
If you’re planning your retirement or already navigating life on the aged pension, changes coming in July 2025 could affect your finances — and your peace of mind.
At downsizing.com.au we’re here to make it easier for over-50s to understand superannuation changes, stay across aged pension rules, and explore smart downsizing for retirement strategies.
Let’s break it down.
Superannuation Cap Rises: A Win for Strategic Retirement Planning
From 1 July 2025, the Transfer Balance Cap increases to 2 million dollars. That’s the maximum you can have in a retirement income account where your investment earnings are tax-free.
If you’ve sold your home and made a downsizer contribution, this allows you to keep more of your retirement funds in a tax-friendly structure.
Real-life example – Helen (67, still working part-time):
Helen is planning to sell her family home and contribute 300,000 dollars to super under the downsizer scheme. The new 2 million dollar cap means she can keep more of her money growing tax-free. Click Here for More Info
Aged Pension Impact: Watch the Deeming Rate Freeze Deadline
If you're on a full or part-aged pension, your eligibility is partly calculated using deeming rates — estimates of income from your financial assets. These rates are frozen until 30 June 2025, but after that, they could rise.
Real-life example – Maria (75, community resident):
Maria lives off her aged pension and modest savings. If deeming rates go up, Centrelink may reassess her income — potentially reducing her payment. Now’s a good time for a pension review or financial health check. Click Here for More Info
New Superannuation Tax Rules for High Balances
From July 2025, if your superannuation balance exceeds 3 million dollars, earnings on the excess will be taxed at 30 percent (up from 15 percent).
Real-life example – Alan (72, self-funded retiree):
Alan downsized from a luxury home and holds over 3 million dollars in super. His adviser is helping restructure investments to minimise the impact of this new superannuation tax. Click Here for More Info
How Downsizing Helps Maximise Super and Pension Benefits
Whether you’re looking to boost your superannuation, free up lifestyle funds, or simplify your life, downsizing for retirement continues to offer significant financial flexibility:
- Eligible over-55s can contribute up to 300,000 dollars to super (per person) from the sale of their home — without affecting contribution caps.
- You can unlock home equity, reduce expenses, and access lifestyle-rich retirement living options.
Real-life example – Carol (68, recently retired):
Carol sold her home and moved into a retirement community. She used the downsizer rule to contribute 250,000 dollars into her super, giving her more income choice and reducing Centrelink stress. Research retirement properties downsizing.com.au
Quick Takeaways
- Super cap rises to 2 million dollars — great for tax-free retirement income planning.
- Pensioners should prepare now for possible deeming rate changes post-June 2025.
- Large super holders face higher taxes on excess earnings.
- Downsizing still offers one of the most powerful tools for retirement planning.
Ready to Plan Your Next Step?
Explore our listings, expert guides and lifestyle community options to help make downsizing and retirement simpler, smarter and more rewarding.
Subscribe to stay updated on the full series: Your Pension, Your Future
Downsizing.com.au Presents Our Upcoming Editorials Series
- Superannuation Changes for Retirees: What the 2 Million Dollar Cap Really Means
- How the New Super Tax Impacts Self-Funded Retirees
- Downsizing and Your Super: Make the Most of Your Home Sale
- Aged Pension and Deeming Rates: What to Expect After June 2025
- Your Retirement Income Checklist for 2025
- Case Studies: How Real Australians Are Navigating the 2025 Changes
