Managing the cost of aged care
Early planning can take away a lot of the stress and uncertainty that can arise when considering aged care at home or a residential aged care facility.
Know what your options are
The first option that probably comes to mind is a residential aged care facility. These facilities provide accommodation and care depending on your personal needs. Care can range from personal care, such as help with showering and dressing, together with occasional nursing care to continuous nursing care for those with a greater degree of frailty.
Home Care Packages are also available, these provide access to services that can help you to stay at home for as long as possible. Support services may include cleaning, meal preparation and transport for shopping or appointments.
If you can, start planning now
There are a number of reasons why it’s beneficial to plan ahead, before the need for aged care is imminent. For example:
- in many cases, the need to move into residential care can be sudden due to a serious illness or injury (eg a stroke, heart attack, or fall), or another unexpected event
- it’s not uncommon to find there are significant waitlists for residential care, particularly at the more popular facilities, and
- regardless of whether home or residential aged care is required, getting things in place early gives you the best chance of minimise the fees you may have to pay and/or maximise the social security benefits you may receive.
Visit local facilities
Whether you currently need residential aged care or not, ideally you should plan to visit a range of facilities in your chosen area as soon as possible and, you may prefer to do this with family members.
Becoming familiar with the alternatives can enable you and your family to have meaningful conversations regarding your options and make more informed lifestyle and financial decisions.
Importantly, with assistance from a financial adviser, you can:
- determine whether care in your preferred facility is affordable, and
- potentially start restructuring your assets to improve your financial position.
A range of fees may be payable when accessing care services. One of the key payments when moving into residential care is the accommodation payment. This payment:
- is subject to certain limits
- can be paid as a lump sum, in regular instalments, or a combination of a lump sum and regular instalments, and
- is published on the facilities website and at myagedcare.gov.au for potential residents to consider.
- The published amount will vary between facilities and, as a general rule, it will be higher for newer places because of the money recently outlaid on building or improving the accommodation, and for facilities in more affluent suburbs.
Understand the options
There are a range of strategies that can be used to manage the cost of aged care fees. Your decision regarding whether to sell or rent out the family home and whether you choose a bond, an ongoing fee or a combination can have big implications for the cost of care and have an ongoing impact on the amount of Age Pension you are entitled to receive. Making sure you have the right amount of flexibility in your financial affairs and that you’ve got a good estate plan in place is also critical. A financial adviser can help you understand the best way to set up your finances to ensure your financial security and comfort into your retirement.