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Aged care - how will it affect your family?

As older Australians make up a larger portion of our population, affordable and reliable care options for our seniors become paramount to more families.

Naturally, when investigating options for an elderly person, finding the right level of care is crucial, as is anticipating future care requirements and planning ahead.

Given a choice, most people would prefer to remain in their own homes but places are limited by the number of visiting carers and services available. The government has committed to ensuring that home care resources will be gradually increased over the coming years, including the provision of differing levels of home care. Costs associated with care are calculated on the single basic age pension and perhaps an extra income tested fee determined by the care required.

The rationale is that those who can afford to pay for care should do so, while the government will subsidise those who don’t have the capacity to pay. People on full pensions are exempt from paying care costs. Fees are now capped on an annual or lifetime basis and indexed annually.

When entering care accommodation aged care residents have the choice of paying a Refundable Accommodation Deposit or making periodic Deposit Accommodation Payments.

To safeguard against the care facility becoming insolvent and unable to repay bonds, the government undertakes to make the repayment to either the resident or their estate. Bond amounts are recovered by the government by it levying a regular fee against the care facility.

Other key aspects of our aged care management include:

• There is no difference between high and low care so that the level of care can be adjusted seamlessly as needed.

• Care facilities are able to offer a wide range of extra-service packages. These are available to all residents for an additional fee, and residents can choose to opt-in or opt-out.

• Additional funding is being allocated to caring for patients with dementia.

• Rental income from the resident’s former home is included in the means test for those entering a residential facility after 1 January 2016.

• The family home remains exempt from income and asset testing.

In an aging society, care for older Australians is a real concern for governments, communities and families. It requires genuine and careful attention. Ongoing reviews and reforms will help, but your financial adviser can assist you to create a tailored strategy that will help you plan for your own family’s future.

*More information is also available at


This information is current as at 19/06/17. This article has been prepared by Heart1Stop, a social media brand owned by Heart Mortgage Services and Heart Financial Advisers. The information contained in this article is an overview or summary only and it should not be considered a comprehensive statement on any matter nor relied upon as such. The views expressed here are not those of Heart1stop, Heart Mortgage Services, Heart Financial Advisers, shareholders, directors or staff and associated contractors and business associates. This article has been prepared without taking into account any person’s objectives, financial situation or needs. Because of this, you should, before acting on any information contained in this article, consider its appropriateness, having regard to your objectives, financial situation or needs. Any taxation information contained in this article is a general statement and should only be used as a guide. It does not constitute taxation advice and is based on current laws and their interpretation. Each individual’s situation may differ, and you should seek independent professional taxation advice on any taxation matters. While the information contained in this article may contain or be based on information obtained from sources believed to be reliable, it may not have been independently verified. Where information contained in this publication contains material provided directly by third parties it is given in good faith and has been derived from sources believed to be accurate at its issue date. It is not the intention of Heart1Stop or Heart Mortgage Services and Heart Financial Advisers that this publication be used as the primary source of readers’ information but as an adjunct to their own resources and training. To the maximum extent permitted by law: no guarantee, representation or warranty is given that any information or advice in this publication is complete, accurate, up to date or fit for any purpose; and no party of Heart1Stop or associated entities as mentioned is in any way liable to you (including for negligence) in respect of any reliance upon such information. This article may also contain links to websites operated by third parties ("Third Parties") who are not related to Heart1Stop. These links are provided for convenience only and do not represent any endorsement or approval by us.

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