Aged Care – options available to you or someone close to you

Whether considering options for yourself or deciding how best to help someone close to you, aged care is a complex area and requires careful thought. The uncertainty surrounding where to move, how much it will cost and where the money will come from can be overwhelming and stressful.

The below guide provides the basics – you will understand the steps you need to take, the answers to ask and the strategies and advice to help you make an informed decision.
Step 1 – Approval
There are typically three steps you need to take before moving in to an aged care facility. Before entering an aged care facility your health must be assessed to decide which level of care is appropriate. The assessment can be performed by any doctor, nurse or social worker who is a member of an Aged Care Assessment Team (ACAT).
Step  2 – Find a home

There are two types of residential aged care facility – hostels (‘low level care’) and nursing homes (‘high level care’). The main difference between hostels and nursing homes is the level of care provided. Hostels provide personal care, accommodation and some level of nursing care, whilst nursing homes provide 24-hour nursing care and accommodation.

Step  3 – Organise your finances

On entry to a facility, you will be required to pay either an accommodation bond (once only) or an accommodation charge (ongoing). Regardless of what type of facility you choose there will also be a basic daily fee to pay and there may be a ‘daily income-tested fee’. Some facilities offer you a higher level of service or a higher standard of accommodation or food. If you have chosen a higher level of services there will also be ‘extra service’ fees payable.

Commonly Asked Questions

  • What upfront costs will I need to pay?
  • How much will I pay for ongoing care?
  • How do I maximise my social security benefits?
  • How can I afford to pay for ongoing care?
  • Will I have something to leave for my family?
  • How much tax will I need to pay?
  • Can I keep my home or is it better for me to sell it?

Many of the available strategies need to be planned, sometimes years, in advance. Your adviser can help you decide if it is best to keep or sell the family home. If kept, we can determine the best way to structure the accommodation bond to ensure the family home does not affect your Centrelink tests. If sold, the best way to invest the proceeds and get the balance right between generating an income, maximising the Age Pension and minimising aged care fees.

What next?
If you need assistance with the decisions you need to make and which strategies are best suited to your circumstances, please contact Sofie Korac on (02) 8252-3207 or email sofie@pfplan.com.au to arrange a confidential, free consultation.
General Advice Disclaimer

The information contained in this guide is provided by Challenger Life Company Limited, ABN 44 072 486 938, AFSL 234670 (Challenger) and is current as at 15 August 2012.

Information contained within the above article is of a general nature only and is provided exclusively for the clients of Prudentia Financial Planning. Individuals should not act upon any such information without prior consultation with a qualified financial adviser to ensure that any action meets their personal financial needs, situation and objectives. No responsibility is accepted by GEM Advisers Pty Ltd t/a Prudentia Financial Planning or their representatives for those persons acting on information contained herein and persons do so at their own risk.
We believe that the information contained herein is accurate and reliable, being based upon Prudentia Financial Planning’s understanding of legislation at the date of publication. Legislation changes may occur quickly.  Personal financial advice should be sought before acting in any of the areas discussed.
Responsibility is disclaimed for any inaccuracies, errors or omissions. Particular investments are neither invited nor recommended. All expressions of opinion are published on the basis that they are not to be regarded as expressing the official opinion of any other person or entity unless expressly stated.

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Sofie Korac is an Authorised Representative (No. 400164) of Prudentia Financial Planning Pty Ltd, AFSL 544118 and a member of the Association of Financial Advisers.

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