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Aged Care Financial Advice

Deciding to move into a residential aged care facility, either for yourself or someone dear, is a major life choice. The complexities of the residential aged care system can present challenges, and attempting to navigate it without specialised aged care financial advice and preparation can make an already difficult process even more challenging.

Key Steps Before Entering Aged Care

Typically, there are three essential steps to follow before you or a loved one transitions into residential aged care:

  1. Approval Process: The first step is to obtain approval for residential aged care. This involves a health assessment to confirm the need for this level of care. Conducted by the Aged Care Assessment Team (ACAT, or ACAS in Victoria), which includes healthcare professionals like doctors, nurses, and social workers, this assessment is vital. To start this process, you can book an evaluation through gov.au.
  2. Selecting an Aged Care Facility: Choosing the right facility is a personal decision, and the most important part is to find a place where you or your loved one will feel comfortable and at home. Your financial adviser can provide guidance in this selection. We suggest visiting various facilities to discover one that aligns with your personal preferences and needs, and you may want to apply to multiple locations that meet your criteria. For information on potential accommodation costs and facility details, visit gov.au.
  3. Financial Management: Upon entering an aged care facility, you may need to contribute towards accommodation costs, depending on your financial situation. While the Government cover some or all of these costs, others have to pay all relevant fees. Your financial adviser will work with the Department of Human Services (DHS) to determine your specific financial obligations, assessing your income and assets at the time of entry. In addition to accommodation costs, residents usually pay a basic daily fee and may also incur a means-tested care fee, which is re-evaluated quarterly. Note that some facilities offer premium services or higher standards of accommodation and meals for an extra charge.

The important thing to remember is that your financial adviser is there to support you through the decisions, planning and financial advice required for entering residential aged care. Furthermore, maintaining an ongoing advisory relationship and regular financial reviews ensures that your financial plan remains effective, even amidst external factors like legislative changes.

Aged Care Frequently Asked Questions (FAQs)

Through our experience in assisting a diverse range of clients with unique needs in aged care, we’ve encountered several frequently asked questions. Here’s a summary:

  • What are the initial costs for aged care? The upfront costs vary depending on the chosen facility. Your adviser will guide you through the payment options for your accommodation, which might include a lump sum, regular payments, or a mix of both.
  • What are the ongoing care expenses? Ongoing costs differ based on individual circumstances and the facility. These may include a basic daily fee, a means-tested fee, and other charges. Financial advisers can often devise strategies to lessen these costs, such as selling the family home. Effective strategies can lead to better entitlements, reduced expenses, and improved overall outcomes. Your adviser will also assist in managing your finances to cover ongoing expenses while maintaining a stable cash flow.
  • Can I retain my family home? Your adviser will explain the consequences of keeping or selling your family home. They will discuss ways to manage accommodation payments and consider how your home affects Centrelink/Department of Veterans’ Affairs (DVA) and aged care assessments. If selling, they’ll help balance income needs, optimise pension entitlements, and reduce care costs.
  • How can I maximise Centrelink/DVA Benefits? Work with your adviser to understand how Centrelink/DVA assets and income tests affect you. They can suggest and implement strategies to increase your Age Pension entitlements.
  • What tax implications should I consider? Tax offsets might be applicable to you, and selling your family home can have tax consequences. Your financial adviser will identify these and collaborate with a tax specialist to enhance your tax position.
  • Will I be able to leave an inheritance? Many wish to leave a legacy, including bequests to family members. Identify the assets you want to bequeath and their beneficiaries. Your adviser will help with the necessary beneficiary nominations and legalities, ensuring your assets are distributed as you wish. McKinley Plowman’s Estate and Succession Planning service specialises in this area.

MP+ Supporting Your Aged Care Journey

Entering residential aged care is a journey that demands thoughtful planning, time, and expert guidance to achieve the best outcomes. Making well-informed decisions is crucial, which is where having a McKinley Plowman financial adviser becomes invaluable, as our approach to Aged Care advice extends beyond just financial feasibility – we offer a comprehensive perspective on your transition into aged care and beyond.

When you work with our advisers and support team, we’ll develop strategies aimed at improving your cash flow, enhancing the value of your estate, and focusing on the elements of care and lifestyle most important to you. This partnership plays a key role in ensuring your aged care experience aligns with your specific needs and lifestyle preferences. If you’re prepared to start this process, reach out to the MP+ team today at 08 9325 2411 (Perth), 08 9301 2200 (Joondalup), or through our website.

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