If you have spent years working hard, paying taxes, and dreaming about the day you pack up and hit the open road, the last thing you want is a letter from Centrelink telling you your pension has been reduced — or worse, suspended — because of how you are living.
The good news is that vanlife and the Age Pension can absolutely work together. Thousands of Australian grey nomads receive the full Age Pension while travelling the country in a van, motorhome, or caravan. But there are rules, thresholds, and reporting obligations that every over-55 traveller needs to understand before they leave the driveway — because getting it wrong can cost you significantly.
This guide covers everything Centrelink expects from you as a travelling retiree, what affects your pension and what does not, and the practical steps you need to take to stay on the right side of Services Australia while living your best life on the road.
Does Living in a Van Affect Your Age Pension?
The short answer is: it depends on your assets, your income, and how you handle your reporting obligations — not on the fact that you are living in a van.
Centrelink does not penalise you for choosing to live a nomadic lifestyle. There is no rule that says you must own a home or live at a fixed address to receive the Age Pension. What Centrelink does care about is the value of what you own, any income you earn, and whether you are keeping them accurately informed as your circumstances change.
The Age Pension is means tested, which means two separate tests apply to your situation: the income test and the assets test. Whichever test produces the lower pension payment is the one that applies to you. Understanding both tests — and how vanlife affects them — is the foundation of everything else in this guide.
The Assets Test and What It Means for Grey Nomads
How the Assets Test Works
The assets test looks at the total value of everything you own, excluding your primary residence if you own one. If the total value of your assets is below the lower threshold, you receive the full pension. If your assets sit between the lower and upper threshold, your pension is reduced. If your assets exceed the upper threshold, you receive no pension at all.
As of 2025, the asset thresholds for a single homeowner are approximately $314,000 for the lower threshold and $686,000 for the upper threshold. For a couple who are homeowners, the lower threshold is approximately $470,000 and the upper threshold is approximately $1,031,000. Non-homeowners have higher thresholds because they do not have the benefit of an exempt primary residence.
These figures are indexed and updated by the government periodically, so always confirm current thresholds directly with Services Australia before making any financial decisions.
Is Your Van or Motorhome a Counted Asset?
Yes. Your van, motorhome, or caravan is considered an asset for the purposes of the assets test, and its current market value must be declared to Centrelink. This applies whether you own a modest campervan worth $30,000 or a fully fitted luxury motorhome worth $200,000.
The value Centrelink uses is the current market value — what you could reasonably expect to receive if you sold the vehicle today — not what you paid for it originally. Vehicle values depreciate over time, which means an older van will be assessed at a lower value than a brand new one. It is worth keeping a realistic record of your vehicle’s current value and updating Centrelink if it changes significantly.
What Happens If You Sell Your Home to Fund Vanlife?
This is where things get more complex, and it is the situation that catches the most grey nomads off guard.
If you sell your family home to fund your vanlife adventure — paying off debts, buying a van, and putting the rest in savings or investments — several things change at once. First, you lose the asset exemption that applied to your primary residence. The proceeds from the sale of your home become counted assets and are assessed under the assets test. Second, you may shift from homeowner thresholds to non-homeowner thresholds, which are higher, giving you some additional buffer.
The net effect depends entirely on your individual financial situation. Some grey nomads find that selling their home and downsizing into vanlife actually improves their pension entitlement because the non-homeowner thresholds are more generous and their overall assessable assets are lower after the transition. Others find that a large amount of cash sitting in the bank from the property sale pushes them over the threshold and reduces or eliminates their pension temporarily.
If you are considering selling your home to fund vanlife, speaking with a financial adviser who understands the Age Pension means testing rules before you sell is one of the most valuable things you can do.
The Income Test and Vanlife
How the Income Test Works
The income test assesses the money you receive from all sources outside of the Age Pension itself. This includes interest on savings, dividends from shares, income from investment properties, distributions from managed funds, and any employment income you earn while travelling.
For a single pensioner, the first $204 per fortnight of income is fully exempt. Beyond that threshold, your pension reduces by 50 cents for every dollar of income over the limit. For couples, the combined fortnightly income free area is $360. Again, these figures are updated regularly so always verify the current amounts with Services Australia.
What About Deeming?
Deeming is one of the most misunderstood parts of the income test, and it catches many retirees by surprise. Rather than assessing the actual interest or returns you earn on financial assets like savings accounts, term deposits, or shares, Centrelink applies a deemed rate of return — a fixed percentage that assumes your financial assets are earning a certain amount regardless of what they actually earn.
If the deemed rate is higher than what your savings are actually earning, you are assessed on more income than you are actually receiving. This can reduce your pension even if your real-world income is quite low. Understanding how deeming applies to your specific financial assets is important, particularly if you have a significant amount of money in savings after selling a property.
Can You Work While on the Road and Still Receive the Pension?
Yes, with conditions. Many grey nomads pick up casual or seasonal work as they travel — fruit picking, farm work, cleaning, or tourism roles. This income is assessable under the income test and must be reported to Centrelink. As long as your income stays within the allowable thresholds, your pension will not be affected beyond the standard reduction formula.
The Work Bonus scheme provides additional relief for pensioners who want to work. Under the Work Bonus, the first $300 per fortnight of employment income is not counted in the income test, and any unused amount accumulates in a Work Bonus bank up to a maximum balance. This makes casual work on the road more financially worthwhile than many grey nomads realise.
Your Address and Centrelink — What You Actually Need to Do
Do You Need a Fixed Address to Receive the Age Pension?
No. Centrelink does not require you to have a fixed residential address to receive the Age Pension. What they do require is a contact address — somewhere that correspondence can be sent and received. This can be a postal address rather than a physical residential address.
Many full-time grey nomads use one of the following solutions for their Centrelink correspondence address: a family member’s home address, a private mailbox service, or the address of a trusted friend. Some use Australia Post’s mail redirection service to have mail forwarded to wherever they are on the road
Getting Your Claim Ready
Before you hit the road full-time, there are several things you need to notify Centrelink about to avoid compliance issues down the track.
You need to update your contact address to ensure correspondence reaches you. You need to declare the current market value of your van, motorhome, or caravan as an asset. If you are selling your home, you need to report the change in your living arrangements and the proceeds of the sale. If your relationship status changes — for example, if you begin travelling with a partner — you need to report this as well, as couple thresholds differ significantly from single thresholds.
Failing to notify Centrelink of changes to your circumstances is treated as a compliance issue and can result in debts being raised against you, even if the failure was unintentional.
Reporting While You Are on the Road
Most Age Pension recipients are required to report their income to Centrelink on a fortnightly basis if they have any assessable income. This can be done online through myGov, through the Express Plus Centrelink mobile app, or by phone. The mobile app is the most practical option for grey nomads because it works wherever you have mobile coverage and does not require visiting a service centre.
If your only income is the Age Pension itself and you have no employment income or other assessable income, your reporting obligations are simpler. But if you are earning casual income on the road, keeping accurate records and reporting every fortnight is essential.
Granny Flat Interests and Vanlife
One situation that sometimes arises for grey nomads is the granny flat interest arrangement — where a retiree transfers assets, often their home, to a family member in exchange for the right to accommodation. This type of arrangement has specific rules under the pension means testing framework and can have significant implications for your assets test assessment. If you are considering any arrangement like this as part of your transition to vanlife, professional financial advice is strongly recommended before any assets change hands.
The Pension Loans Scheme — A Little-Known Option for Asset-Rich Grey Nomads
If you own significant assets — particularly a property — but find your pension is reduced or eliminated by the assets test, the Pension Loans Scheme is worth knowing about. This government scheme allows eligible older Australians to borrow against the equity in their real estate assets to supplement their income, with the loan repaid from the estate when the property is eventually sold.
For grey nomads who own a property but are living on the road and asset-rich but income-poor, this scheme can provide additional financial flexibility. It is not widely promoted and many eligible retirees are unaware it exists. Ask Services Australia directly or speak with a financial adviser about whether it suits your circumstances.
Common Mistakes Grey Nomads Make with Centrelink
Not Declaring the Van as an Asset
It is surprisingly common for new grey nomads to overlook their vehicle when declaring assets to Centrelink. Whether through genuine oversight or a misunderstanding of the rules, failing to declare the current market value of your van, motorhome, or caravan is a compliance issue that Centrelink can and does pick up on.
Not Reporting Changes After Selling the Family Home
The transition from homeowner to non-homeowner is one of the biggest changes you can make to your Centrelink assessment, and it needs to be reported promptly. Many grey nomads delay this notification or are unsure how to handle it, which can create complications with both overpayments and underpayments.
Assuming Nothing Will Change
Some grey nomads set up their pension, hit the road, and assume everything will take care of itself. But circumstances change on the road — you might earn some income, your van might increase or decrease in value, you might receive an inheritance, or your savings balance might shift significantly. Centrelink expects you to report these changes, and the responsibility rests with you to do so.
Not Using the myGov App
Managing your Centrelink obligations from the road is genuinely easy if you are set up on myGov and the Express Plus Centrelink app before you leave. Trying to sort out compliance issues, update your details, or report income without digital access while parked in a remote part of the Kimberley is a much harder problem to solve.
Practical Steps to Take Before You Leave
Set up your myGov account and link it to Centrelink before you hit the road. Download the Express Plus Centrelink app and make sure it is working correctly. Update your contact address to a reliable postal address. Declare your van, motorhome, or caravan as an asset at its current market value. If you are selling your home, notify Centrelink of the change in your living arrangements and the sale proceeds before or immediately after settlement. Speak with a financial adviser who specialises in Age Pension means testing if your financial situation is complex. Keep records of any income you earn on the road, no matter how small.
Frequently Asked Questions
Will Centrelink Cut Off My Pension If I Live in a Van?
No. Living in a van does not disqualify you from the Age Pension. What matters is the value of your assets and your income, not your choice of home. As long as you meet the means test thresholds and fulfil your reporting obligations, your pension is not affected by the fact that you live on the road.
What If My Assets Temporarily Exceed the Threshold After Selling My Home?
If the proceeds from selling your home push your assets above the threshold, your pension may be reduced or suspended temporarily. This is not permanent. As you spend down those assets over time — on living expenses, van purchases, travel costs — your assessable assets will reduce and your pension may be reinstated or increased. Centrelink reassesses your situation regularly.
Do I Have to Tell Centrelink Every Time I Move to a New Location?
No. You do not need to report every campsite or caravan park you stay at. What you need to maintain is an accurate contact address for correspondence and report changes to your financial circumstances. Your physical location on any given night is not something Centrelink needs to know about for pension purposes.
Can I Receive the Age Pension While Travelling Overseas?
The Age Pension can be paid while you are overseas, but the rules change depending on how long you are away. For absences of less than six weeks, your pension generally continues unchanged. For longer absences, different rules apply and your payment may be affected. If you are planning extended travel outside Australia as part of your vanlife adventure, check with Services Australia well in advance.
Final Word
Vanlife and the Age Pension are not in conflict — they are perfectly compatible for thousands of Australian grey nomads who are out on the road right now, living freely and receiving their full entitlement.
The key is preparation. Know your assets. Understand the means testing rules. Set up your digital reporting before you leave. And if your financial situation is at all complex — particularly if you are selling a home or have significant savings — invest in one good session with a financial adviser who knows the Age Pension system inside out. That conversation could save you thousands of dollars and a great deal of unnecessary stress.
The open road is waiting. A little paperwork now means nothing but freedom later.
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