Navigating life’s financial decisions, especially regarding aged care and family homes, demands careful consideration.
When aged care becomes a reality, Precision Wealth Management is here to help provide advice and strategies on the best way to move forward. We understand this decision’s complexities and aim to provide clarity through informed considerations tailored to your unique circumstances. When preparing for aged care, let’s look at a few scenarios and key considerations when contemplating what to do with your family home.
1. Aged care decisions: keeping your home for a protected person
Keeping your home can offer stability and financial protection if you have a protected person in your household, such as a spouse or dependent relative.
Assets above $197,735 but below the cost of the Refundable Accommodation Deposit (RAD) can pose challenges, particularly with funding the Daily Accommodation Payment (DAP), which may rapidly deplete your assets.
For individuals with assets below $58,500 (excluding their primary residence), securing the required care within an aged care facility may come with minimal out-of-pocket costs. This can be a favourable solution, especially if one member of a couple requires care while the other remains at home.
2. Aged care financial advice: renting out your home
Renting out your home presents a viable option but comes with considerations regarding income and asset assessments by Centrelink.
While your home is exempt from the asset test for two years, ongoing costs like the DAP and means-tested care fees may necessitate selling the home later on.
This strategy is suitable for individuals with ample assets to cover the RAD upfront and who can benefit from the exemption period.
3. Selling your home to pay for the aged care RAD
Selling your home to fund the RAD can alleviate ongoing financial burdens associated with aged care, such as DAP payments, especially in today’s high-interest-rate environment.
By selling your home, you secure the RAD and provide beneficiaries with a lump sum upon exiting care, ensuring a legacy for the future.
This option is ideal for those needing immediate funds for the RAD or who will still qualify for the full-age pension post-sale.
Financial Advice for Aged Care: Key Considerations for Your Home
Prior to aged care, the decision regarding your family home is multifaceted and deeply personal. It involves assessing financial implications, considering the needs of all involved parties, and planning for the future with foresight and care. At Precision Wealth Management, we’re here to guide you through these considerations, empowering you to make informed choices that align with your goals and values. Contact us today for financial advice to pre-plan aged care confidently and clearly.
DISCLAIMER – The information provided in this blog is general and does not consider your individual financial needs or objectives. It does not constitute personal advice. We recommend seeking out professional and independent financial, legal and tax advice which has been designed for your individual situation before acting on any information contained below.
Precision Wealth Management is a local, privately-owned financial planning firm based on Brisbane’s northside.
Our certified advisors work with each individual client to determine the best wealth creation strategy based on their unique situation.
We strive to stay at the forefront of the industry, and our investment approach is based on decades of research.
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Our services include Superannuation Advice And Planning, personal Insurance Advice, Budgeting And Cashflow Management, Investment Strategy And Advice, Aged Care Financial Advice, Retirement Planning Advice, and Debt Reduction Financial Planning.
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