It can be difficult to plan, both financially or emotionally, for the move into an aged care facility. When choosing the best care as a part of your retirement – or for loved ones – many practical issues arise and decisions need to be made. It’s important to know what’s involved and have the confidence to face the challenges of aged care. Here are some tips to get you started:
Determine eligibility for different aged care facilities, and what level of care may be needed. This is established via assessment by an aged care assessment team.
Aged care fees can be high. Find out the fees applicable to various aged care facilities and whether extra services can be purchased. Generally, for a permanent resident, the types of fees that can be charged include:
a basic daily fee
a means tested care fee
an accommodation payment
extra services fees.
The family home
The decision to sell the family home can be one of the most emotional decisions faced when entering aged care. For some it may be the only option however for others, it may be possible to retain the family home and rent it out.
If retaining and renting out the former family home, it is important to consider the income tax impact as the rental income is assessable for tax purposes. Consider the capital gains implications and whether renovations are required.
Cash flow and Centrelink payments
It is important to understand how your assets and income will affect Centrelink entitlements, including age pension entitlements. Remember there may be costs that are easily overlooked such as paying for the ongoing maintenance of the former family home.
Avoid taking actions that could result in a loss of age pension and increased aged care costs, for example gifting assets outside Centrelink gifting rules.
Review estate plans
It is important to review estate plans and important legal documents, such as an enduring power of attorney when entering into aged care.
Seeking financial advice when considering aged care can ensure the decisions you and your family make will be the right ones. Talk to us to ensure your aged care plans are a part of your overall retirement plan.