What is the Liquid Assets Waiting Period test? 1
The Liquid Assets Waiting Period (LAWP) is a period that you must wait before being paid an allowance (Newstart, Sickness and Youth Training), if you have ‘liquid’ funds above the threshold. The maximum LAWP is 13 weeks and is applied from the date that your employment ceased.
Liquid assets are any readily available funds, including those of your partner, which you can access within 28 days of the date you last worked.
What types of asset are considered to be liquid assets?
The following are considered to be liquid assets taken into account to determine the relevant waiting period:
- Cash,
- Shares and debentures,
- Term deposits,
- Other money available at short notice,
- Payments made or due and able to be paid in respect of a claimant’s or spouse’s last paid employment,
- 10-year insurance bonds (aka Investment Bonds), and
- Amounts deposited or lent to banks or other financial institutions, whether or not the amount can be withdrawn or repaid immediately.
What assets are not considered to be liquid assets?
Superannuation and termination payments which have been rolled over or are going to be rolled over directly from the claimant’s employer are not considered to be liquid assets.
How is the liquid asset waiting period test calculated?
The steps to calculating the Liquid Assets Waiting Period (LAWP) are as follows:
- Determine the LAWP threshold – the threshold for single people with no dependants is $5,500. For couples and single people with dependants it is $11,000.2
- Calculate the excess liquid assets – liquid assets over that threshold amount.
- Calculate the waiting period number – divide the excess liquid assets by the relevant divisor. The divisor is $550 for a single person with no dependants and $1,100 for others.3
- Round the answer to the nearest whole number – the result is the Liquid Asset Waiting Period in weeks except that the maximum waiting period is 13 weeks.
Example: Jessica has left her current employer and is seeking new employment. She has $9,848 in her savings bank account, is single with no dependents and she is seeking Newstart Allowance. How long does Jessica have to wait until she receives Newstart Allowance? Calculate her waiting period:
There is a general 1 week waiting period, so Jessica should qualify for Newstart in 9 weeks. (Note: the Human Services website publishes a Table that shows a quicker way to determine the weeks of waiting – it sets it out on the basis of ranges of Liquid Assets held.) |
How do the LAWP and Income Maintenance Period (IMP) operate together?
The IMP and LAWP are determined independently of each other and are served concurrently.
So When will the allowance commence?
The Centrelink Allowance to which you will be entitled will not commence until after the expiry of the LAWP – there will be no back-pay of the Allowance.
Continuum Financial Planners at your service.
Our experienced financial advisers are able to assist you with planning your financial future, covering matters such as superannuation, investing for goals, insurance, retirement – and estate planning: contact us to determine how we might be able to assist you (use the linked form, or phone us on 07 3421 3456 – the initial meeting will be at our cost; and at no obligation for you.
1 Information above was updated and is current as at August 2019.
2 The thresholds are varied from time to time and should be confirmed on the Centrelink website.
3 Centrelink now calculates the waiting period on receipt of your completed application: they will confirm their methodology for you.
We acknowledge the resources of Securitor Financial Group Limited in drafting the majority of the detail in the above article: it has been extracted from the Support Information to advice documents.
I was on newstart last October 2018 and was told we can have approx $300000 in cash etc not including home. This was told to me by a Centrelink staff member in bundaberg office. I received the dole with no waiting period. I have been working since October last week but have just been made redundant. Will I receive dole again with no waiting period? I have tried ringing but no one answers. Please help. Thank u
Thank you for your question Deb: I believe the issues you raise are separate, but will have the effect that you will have a waiting period in this instance. The assets you hold/ can hold impact the assessment of your entitlement to the level of allowance you might receive. The Liquid Assets Waiting Period determines the period you have to wait before that allowance commences. Nevertheless, your personal circumstances should be discussed with one of Centrelink’s Financial Information Service Officers.
Given that there is the liquid assets waiting period, do you still get back payed from starting the newstart claim? or only from when the waiting period is over?
Thank you for your enquiry Noah.
The purpose of the Waiting Period is to defer payment of any entitlements until you have met your financial needs from your own resources in the first instance. It is our understanding that there is no ‘back pay’ once the assessed period has expired.
Best wishes…the Team at ContinuumFP
I work as sole trader but have been overseas for 6 months still working ll the time. now i am returning to australia do i need to have a waiting period if i have money in the bank before i can claim?
Anna – Thank you for your question. You haven’t provided enough information about the type of benefit you would be claiming for me to even attempt a reply. It will probably be more appropriate that your question be directed to a Centrelink-based Financial Information Services Officer (you can access them through the Centrelink (Department of Human Services) website) so that relevant personal financial information can be shared to get a comprehensive answer.
I have been told i cant get newstart till the 6th June. My question is do i receive a health care card in this waiting period
Margaret – you will need to discuss your personal circumstances with a Centrelink officer: the issue of a Health Care Card can arise from a range of situations and there are different rules apply in the different circumstances. Best wishes for a prompt response to your needs.
we are a couple over 55 and want to go on the paid volunteer newstart
do we still have to wait for the 10 wk period to finish before payments are made to us?
Hi Tony – thanks for your enquiry, but without knowing your personal circumstances, we can’t provide you with a firm answer. You should make contact with the Human Services Department through a local Centrelink office for the correct answer in your situation. Best wishes. ContinuumFP.