Get specialist advice for big decisions in life
Getting specialist financial advice on aged care can provide guidance in what might be quite a stressful time for some. Our aim is to work out the best way to structure the finances. Putting you in the best position as the transition occurs.
There are two different types of aged care; help at home and aged care homes. There are also different levels and packages with help at home, depending on the care required.
Moving into an aged care facility sometimes does require some extra planning and speaking with a financial advisor can help.
An additionally great place to get information and insight as well as answers to any questions you may have is the My Aged Care website.
Why should I seek a financial advisor who specialises in Aged Care?
It is important to seek financial advice on aged care with an advisor who experience in the aged care space, as it is a specialist area. Not all financial advisors may have the necessarily skills to ensure that the transition occurs with the right asset and income structure. This is important to ensure Centrelink entitlements are maximised and aged care fees are minimised, where possible.
Some people automatically think that it is necessary to sell the family home to pay a bond. However, sometimes that might not be possible or necessarily achieve the best result. Especially if there is another spouse who is not in need of aged care.
A financial advisor can also highlight investment products available that have extremely beneficial features from an aged care perspective. These products aim to reduce the amount of assessed assets and income. Whilst providing an income and a 100% guarantee back of funds invested upon death.
What are the fees involved with Aged Care homes?
There are up to three different kinds of fees that are required to be paid when entering an aged care facility.
The first fee that everyone pays is the basic daily fee, this is currently $49.42 per day.
The second fee is the accommodation component. This will depend on whether the person is low or moderate means.
If you are low means you will either pay a refundable accommodation contribution (RAC) or a daily accommodation contribution (DAC) or a mixture of both.
Moderate means will pay either a refundable accommodation deposit (RAD) or a daily accommodation payment (DAP) or a mixture of both.
Lastly, depending on your level of income and assets, you may be asked to pay a means tested care fee as well. This has a maximum cap of around $25,000 and a lifetime cap of around $62,000. This means if the fee is paid for roughly 2.5 years, it will no longer need to be paid. It is however indexed, so there could be small annual top ups.
Centrelink does not count the RAC or RAD as an asset and it is not deemed for income purposes. However, the aged care facility will account for it when calculating the costs mentioned above.
If you are a couple and one member goes into care while the other member stays in the family home. The aged care facility does not consider the house as an asset.
When is the best time to get financial advice on Aged Care?
Where possible, having the time and not making rushed decisions is paramount. It’s important to understand the process. To be able to do some research into the different care facilities and their specific offerings before making your ultimate choice.
Affording the time to do this prior to having to make a decision means that you can get insights on the costs and benefits. As well as making any necessary asset and income restructures before the transition into a facility.