If you receive a payment from Centrelink or Veterans' Affairs, you need to update your records every time your circumstances change. This includes when you move into Aged Care. The amount you receive after moving into care may change. It may increase or decrease depending on your circumstances and how your income and assets change.
If you are a member of a couple, you will still have combined income and assets assessed, but you will both start to be paid at the higher single rate of pension.
If you keep your former home, you may continue to be assessed as a homeowner for up to two years, with your home remaining an exempt asset for Centrelink and Veterans' Affairs. If you entered care before 1 January 2017 and structure the arrangements carefully, you can even rent your home without the income affecting your age pension. However, the assessment of rental income for aged care fee purposes will depend on when you entered permanent care.
If you sell your home, you will become a non-homeowner. Still, the amount you pay to the service provider as a Refundable Accommodation Deposit (RAD) is exempt for Centrelink and Veterans' Affairs and may help to maximise your age pension. This amount is still assessable, however, when calculating your means-tested daily care fee.
To ensure you maximise your Centrelink or Veterans' Affairs entitlements, it is important to seek advice from a qualified financial planner to ensure the arrangements are appropriately structured and to determine whether it is more effective for you to sell or keep your home.
Before making any decisions, contact an accredited aged care adviser to talk through the care options available to you, the costs associated with them and the best way to restructure your finances to pay for the appropriate care.
Getting the right information and advice can help you to understand your options and the implications for your cash flow, Centrelink or other concession cards, aged care fees, taxation and estate planning. This will allow you to make the best choices for your future care, security and happiness.
Bill Savellis
Senior Financial Adviser
Having navigated the Aged Care landscape for both of his parents, Bill understands how challenging it can be to make the right decisions for your future care needs. That's why he believes that everyone should have access to financial advice during this time. Bill has been a Financial Adviser for over 22 years, and is passionate about helping others access the financial advice they need. Drawing from his own experience in the financial sector, Bill develops strategic, personalised plans to support transitions to Aged Care or Home Care.
Disclaimer: Prepared without taking into account your objectives, financial situation or needs. Before acting on any information in this article, Olive Grove Financial Advice recommends that you consider whether it is appropriate for your circumstances. Information in this article was correct and current as of 22 February 2022. Olive Grove Financial Advice is operated by Bill Savellis through The Financial Advisor (Australia) Pty Ltd ABN 72 619 546 431, who is a Corporate Authorised Representative (No. 1278394) of Havana Financial Services Pty Ltd.
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