Aged Care
Financial Advice
When a parent needs more care than family can provide, the decisions come fast and the financial stakes are high. Our aged care financial advisers help families navigate the costs, funding options and paperwork with clarity, so you can focus on what matters most.
What aged care advice involves
Aged care decisions involve some of the most complex financial choices a family will face, from accommodation payments to the family home, Centrelink entitlements and ongoing fee structures. Getting the right advice early can protect your assets and reduce unnecessary costs.
Most families come to us in the middle of it. A parent is in hospital, a place has come up, and there is a deadline on a decision worth hundreds of thousands of dollars. You are being asked to choose between paying a lump sum or a daily fee, to decide what happens to the family home, and to sign an accommodation agreement, often within days. We help you understand what each choice actually costs your parent and your family, before you commit to it.
How an aged care adviser can help
Transitioning to aged care involves complex financial and emotional challenges. Seeking advice from financial advice specialists can provide valuable insights to manage the financial aspects of this change. Despite the challenges, transitioning to aged care can be a positive experience with the right preparation and support.
We will help you determine the best approach for you and your family, including funding accommodation payments, structuring cash flow, the benefit of tax offsets, options regarding the family home, optimising Centrelink entitlements, reducing the impact on life savings and estate implications. Our advisers will also review superannuation and investment strategies to ensure they align with aged care needs.
Accommodation payments: lump sum, daily payment or a combination
Residential aged care accommodation is usually paid as a refundable lump sum, as a daily payment, or as a combination of the two. The choice is not just about what you can afford. It changes how your parent’s assets are assessed for both aged care fees and the Age Pension, and it changes what is left in the estate. We model the options side by side so the trade offs are visible before you sign an accommodation agreement.
The family home: sell, rent or retain
The family home is usually the largest asset and the hardest decision. Selling releases funds but changes the means assessment. Renting produces income but that income is assessed. Retaining the home preserves it for the estate but may leave a funding gap. There is no single right answer, and the answer changes depending on whether a spouse still lives there. We work through each scenario with the numbers attached.
Centrelink and DVA entitlements
Aged care fees and Age Pension entitlements are linked. A decision made to reduce one can increase the other. We review the means assessment, identify where entitlements are being missed, and make sure changes in circumstances are reported correctly and on time, which is now a legal obligation.
Cash flow structuring for ongoing fees
Accommodation is only part of the cost. There is an ongoing daily fee, a means tested contribution for many residents, and potentially additional service fees. We build a cash flow plan that shows where the money comes from each month and how long it lasts, so the family is not revisiting this decision in two years.
Tax offsets and reducing aged care costs
Aged care costs interact with the tax system in ways that are easy to miss, including offsets that may be available and the tax treatment of income produced by assets used to fund care. We coordinate with your accountant where one is involved.
Superannuation and investment strategy alignment
An investment strategy built for a person in their seventies is rarely right for a person entering residential care. Timeframes shorten, liquidity matters more, and growth assets may no longer be appropriate. We review existing superannuation and investments against the new reality.
Estate planning and wealth protection
How aged care is funded directly affects what is left behind and who receives it. This is the point where aged care and estate planning have to be considered together rather than separately.
Speak to our experienced team today.
Aged care advice by situation
1 – A parent has had a fall and needs care within weeks
Hospital discharge deadlines compress a decision that deserves months. We can work to that timeline, prioritising the decisions that are hard to reverse and deferring the ones that are not.
2 – A parent has dementia and capacity is in question
If your parent can no longer make financial decisions, someone needs the legal authority to act. Whether an enduring power of attorney is already in place changes what is possible. We work with your legal adviser on this and can flag it early.
3 – Deciding whether to sell the family home
Often the single biggest decision, and one where the tax, Centrelink, aged care fee and estate consequences all pull in different directions. See the section above.
4 – One parent enters care while the other stays home
This changes the means assessment substantially and raises questions about how the couple’s assets are treated. It is one of the more common situations we see and one of the most frequently miscalculated.
5 – Siblings disagree about the approach
We are not family mediators, but a clear model showing what each option costs and what each leaves in the estate often resolves disagreements that feel emotional but are actually financial.
6 – A parent is already in care and the fees have increased
Fees are reassessed as circumstances change. If a bill has jumped unexpectedly, there is usually a reason in the means assessment, and sometimes there is something that can be done about it.
7 – Veteran or DVA entitlements are involved
Veterans and their partners may have entitlements that change the picture. These are often overlooked by general advice.
Who this is for
- Families arranging residential aged care for a parent or partner
- People planning ahead for their own future care needs
- Attorneys or guardians managing someone else’s financial affairs
- Families already in the system facing unexpected fees or a change in circumstances
Who this isn’t for
- Families looking for help choosing a facility or assessing care quality. That is a different service and My Aged Care is the right starting point.
- Anyone needing legal documents drafted. We coordinate with your solicitor, we do not act as one.
- Families seeking free general information only. Services Australia’s Financial Information Service is a genuinely useful free resource and we will happily point you there.
Our advice process
01 Evaluation
02 Discovery
03 Strategy
04 Implementation
05 Review
Speak to our experienced team today.
Aged Care Financial Advisory FAQs
What is the difference between RAD and DAP in aged care?
They are two ways of paying for the same thing: your accommodation in a residential aged care home. A refundable accommodation deposit is a lump sum, refundable when the resident leaves care, subject to any amounts the provider is permitted to retain. A daily accommodation payment is an ongoing daily charge instead of the lump sum. You can also pay a combination of the two. The choice affects your parent’s means assessment, their Age Pension entitlement and what remains in the estate, so it is worth modelling before you sign an accommodation agreement.
Should we sell the family home when a parent moves into aged care?
Not necessarily, and it is rarely a straightforward decision. Selling releases funds to pay a deposit but changes how your parent’s assets are assessed for both aged care fees and the Age Pension. Renting the home produces income, but that income is assessed too. Retaining it preserves the asset for the estate but may leave a funding gap. The answer also changes if a spouse or a protected person still lives there. This is one of the decisions where advice before acting matters most.
How does Centrelink means testing affect aged care fees?
Aged care fees and Age Pension entitlements are assessed using related but separate rules, and they interact. A means assessment considers both income and assets, and the result determines whether your parent contributes towards their care and accommodation costs and how much. Because the two systems are linked, a decision that reduces one cost can increase another. Changes in circumstances must be reported to Services Australia, and there are time limits on doing so.
When is the right time to seek aged care financial advice?
Earlier than most families do. The ideal point is before a place is accepted and before an accommodation agreement is signed, because that is when the most options are still open. In practice many families come to us during a hospital stay with a decision due in days, and we can work to that timeline. If a parent is already in care and fees have changed unexpectedly, it is still worth a conversation.
Do we have to sell the family home to pay for aged care?
No. Selling is one option among several. Accommodation can be funded from a lump sum, from ongoing daily payments, or from a combination, and the funds can come from various sources rather than only from the home. Some families rent the home to help fund daily payments. Others retain it unchanged. What matters is how each option affects the means assessment, the Age Pension, ongoing cash flow and the estate, which is different for every family.
What happens if we cannot afford the accommodation deposit?
There are options. Accommodation can be paid as an ongoing daily amount rather than a lump sum, or as a partial lump sum with the balance paid daily. There are also government arrangements for people with limited means, where the government contributes towards accommodation costs. A provider cannot refuse a resident purely because they choose to pay daily rather than as a lump sum. Working out which pathway applies starts with the means assessment.
How does the former home affect my parent's Age Pension?
It depends on what happens to it and who else lives there. The former home is treated differently for aged care fee purposes and for Age Pension purposes, and the treatment can change after a period of time has passed. If the home is rented, the rental income is assessed. If it is sold, the proceeds are assessed. If a partner remains living there, different rules apply again. This is one of the more common sources of unexpected fee changes, and it is worth understanding before rather than after.