Understanding Aged Care fees in Australia

TL;DR

This video provides information on the refundable accommodation deposit (RED) in residential aged care and offers strategies to reduce aged care fees.

Transcript

g'day and welcome to this week's video my name is ashley rowan and i'm a financial planner with consortium private wealth in today's video we're going to be looking at an aged care topic and in particular understanding the refundable accommodation deposit so the the main fee when it comes to residential aged care before we kick things off though a ... Read More

Key Insights

• 😨 There are three main fees in residential aged care: basic daily care, means-tested care contribution, and refundable accommodation deposit (RED).
• 🤱 Different types of residents have different fee obligations, with fully supported residents exempt from paying the RED and means-tested care contribution fee.
• 🍹 Residents can fund the RED through a lump sum payment, a daily accommodation payment (DAP), or a combination of both.
• 😘 Asset reduction strategies can help residents qualify for lower fee classifications.
• 😨 Estate planning plays a crucial role in reducing aged care fees and ensuring the transfer of assets to the next generation.
• 😨 Seeking advice from a qualified financial advisor early on is crucial in understanding and navigating aged care fees.
• 😨 There are various strategies available to reduce aged care costs and professionals who can provide appropriate advice.

Questions & Answers

Q: What are the three main fees in residential aged care?

The three main fees are the basic daily care fee, means-tested care contribution fee, and refundable accommodation deposit (RED).

Q: Who is exempt from paying the RED and means-tested care contribution fee?

Fully supported residents, with assets below $50,500, are exempt from paying the RED and means-tested care contribution fee.

Q: What are the options for funding the RED?

The options are paying a lump sum, paying an interest-only daily accommodation payment (DAP), or a combination of both.

Q: Do residents have to sell their homes to pay for aged care?

No, residents do not have to sell their homes. There are strategies such as setting up a granny flat or gifting that can help reduce aged care fees.

Summary & Key Takeaways

• The three main fees in residential aged care are the basic daily care fee, means-tested care contribution fee, and refundable accommodation deposit (RED).

• Different types of residents in aged care have different fee obligations, with fully supported residents exempt from paying the RED and means-tested care contribution fee.

• There are three options for funding the RED: paying a lump sum, paying through a daily accommodation payment (DAP), or a combination of both.