Which is the best way to go to fund aged care?
This is the main work that we do to help people.
There is no one best way to go, & the biggest mistake that people make is assuming that because Mum or Dad’s financial situation is simple that aged care will be simple
The problem is that it doesn’t matter how simple your financial situation, the rules of aged care are VERY complicated, extremely bureaucratic & subject to Centrelink rules even if you are not getting a pension from Centrelink.
The people who don’t need help are extremely wealthy or extremely poor, as with everything else the Government does it is the people in the middle who cop it. It is those people with some assets & some income, where understanding the choices you have, & how the tricks or traps may apply to you, is where you can save money.
Whether you pay the RAD or DAP will be driven by your situation, the size of the Accommodation Payment, does the aged care facility charge an Extra Service fee or an Additional services fee, whether you have the money to pay the RAD (Lump Sum) or would you have to sell an asset, & how long is the person going into care likely to be in care. if an asset is to be sold which assets should be sold. Many people don’t wish to sell their home because they want to go home again, or because it is a fantastic asset, or because there are emotional attachments to property. If other assets are to be sold, what are the implications, will there be any Capital Gains Tax to pay?
Generally, if you want to keep the home, then either a small Accommodation Payment would work better, or you already have a large part of the Accommodation Payment in cash, or can sell another asset to pay the Accommodation payment as a RAD or mostly as a RAD. But don’t assume, everyone has a different financial situation & everyone has different objectives & preferences & priorities, & therefore the outcomes can be substantially different
Some people do a lot of research & get to understand all about RAD’s DAP’s & Means Tested Fees & assume they understand it all, but how the rules will apply in your case, is the part that is not available on the websites, also finding the particular traps & pitfalls that may apply to you, is also not on the websites, usually you will need expertise to see just how these things affect you, given your unique set of circumstances.
Another area where people make mistakes is assuming that what worked for someone else will also be best for me. There are friends & relatives who are well intentioned with their advice & comments about what worked for them. However, keep in mind that there have been around 22 changes to c
Have a look at the case studies section to see examples of just how some people got it so wrong, yet it worked well for others.
If you want to really know the best way to pay for aged care, that suits you. Why not call us for an initial phone consultation (so we can understand your situation & point you in the right direction OR make an appointment to see one of our Specialists.