Everything Victorians need to know about finance changes in 2025

Victorians are starting the new year with a raft of financial changes affecting superannuation, Medicare, pensions, Centrelink and parental leave. Here’s a breakdown of what’s coming in 2025.

Victorians are starting the New Year with a raft of financial changes.

Victorians are starting the New Year with a raft of financial changes, affecting superannuation, Medicare, pensions, Centrelink and parental leave.

Here’s a rundown of what could affect your hip pocket in 2025.

Medicare

The original Medicare safety net threshold – the amount you need to reach for Medicare to reimburse you 100 per cent of the Medicare benefits schedule – will jump from $560 to $576.

The extended Medicare safety net threshold – the amount you need to reach to get Medicare to pay 80 per cent of out-of-pocket costs – will increase from $2544 to $2615.

The original Medicare safety net threshold will jump from $560 to $576.

For concession card holders and families eligible for family tax benefit the extended threshold will change from $811 to $834.

The Medicare program and phone claim line will no longer be available 24-hours.

From January 2 it is only available Monday to Friday, from 7am to 10pm, and on weekends, from 7am to 7pm.

Parental leave

From July 1 superannuation will be paid on paid parental leave.

Contributions are calculated at 12 per cent of the payment.

This will result in around $4,000 extra in the retirement incomes of parents who take time off to care for their newborn.

Eligible parents will receive these contributions as a lump sum, including interest, after the financial year ends.

Parental leave will also be expanded by two weeks, totalling 22 weeks.

The scheme will continue to expand each year until it reaches 26 weeks in July 2026.

Centrelink payments

Major Centrelink payments will be increased, in line with inflation.

Youth allowance payments to single recipients over 18 who live at home will increase by $17.30 a fortnight from $459.80 to $477.10.

Major Centrelink payments will be increased, in line with inflation.

Those out of home will get $670.30 – up from $646. Recipients with children will get an additional $30.60 a fortnight, totalling $845.80.

Carers will also get an increase under Carer Allowance payments by $5.80, bringing the rate to $159.30 per fortnight.

Austudy recipients with no dependent children will get $670.30 a fortnight, while those with children will receive $845.80.

The maximum rates of ABSTUDY Living Allowance for Masters and Doctorate students will jump to $1285.40 a fortnight, while the parental income test threshold for Youth Allowance will see an increase to $65,189 a year.

Home loans

There’s hope on the horizon for homeowners, with the big four banks forecasting 2025 will be the year interest rates begin to fall.

A home loan interest rate dictates the size of mortgage repayments – which are often the largest expense in a household’s budget.

Experts say 2025 will be the year interest rates begin to fall.

Interest rates in Australia are currently at their highest in more than a decade.

But in good news, CommBank has forecasted a February 2025 rate cut and NAB, Westpac and ANZ have all forecasted May 2025 rate cuts.

Pension rule changes

Holders of legacy pensions – started before 20 September 2007 – will have five years to change their pension to a more flexible account-based pension, accumulation account or cash.

The change, which started in December 2024, aims to give retirees with older pension products more flexibility to adjust their arrangements to meet current needs.

Superannuation increase

Workers will get an automatic boost to their retirement savings when compulsory super payments increase to 12 per cent from July 1.

Workers will get an automatic boost to their retirement savings.

The super guarantee rate will increase from 11.5 to 12 per cent, meaning your employer will put a higher percentage of your pay into your super.

Wage theft penalties

Intentional underpayment of wages by employers has become a criminal offence as of January 1.

Penalties include up to 10 years in prison and a $1.5m fine for individuals and $7.8m for companies.

The new law does not apply to employers who unintentionally underpay their employees, or pay incorrect amounts by mistake.

Small businesses with fewer than 15 employees won’t be referred for criminal prosecution for underpaying employees if they comply with a voluntary small business wage compliance code. This code is yet to be finalised.