Navigating the transition into residential aged care can be a daunting process, often fraught with complicated rules, family conflicts and tight timeframes. Such circumstances can easily lead to costly mistakes that are challenging to rectify. This article sheds light on three common pitfalls and offers tips to avoid them.
1. Rushing your decision
One of the most significant expenses you'll encounter is the cost of your room, often quoted in hundreds of thousands of dollars. However, instead of a lump sum, you may opt to pay a daily fee.
Signing contracts under pressure can lead to hasty decisions, potentially locking you into a quick home sale. Take your time to understand your options and make an informed decision. Providers are mandated to allow 28 days post-move-in for payment deliberation, affording you the chance to seek advice and prepare.
2. Just focusing on day 1
While it's crucial to comprehend the fees payable on your first day in residential care, this is merely the starting point. Your fees evolve over time, influenced by decisions made post-entry and changes in your circumstances. Ensure you anticipate fee variations over the subsequent 2-5 years, with projections showing anticipated shifts in fees, age pension, cash flow, and asset values.
3. Filling-in forms incorrectly
Services Australia needs to review your financial position to calculate your fees. To enable this assessment, you need to complete some forms and update Centrelink (or Veterans’ Affairs) records.
If you don’t fill in the right form, or make mistakes with the information provided, your fees might be incorrectly calculated or cause long delays with the assessment.
Get advice
Even if your situation seems simple, there are so many aspects to consider in working out the best financial strategy. Consulting with an accredited aged care adviser provides peace of mind, ensuring you've made prudent decisions to sustain adequate cash flow while safeguarding your estate's value.
If you wish to explore your options or seek tailored advice, please don't hesitate to contact our office on 02 4325 0884 to arrange an appointment.
Sophie Doyle (AR#000470612) is a Retirement and Aged Care Specialist at Morgans Financial Limited (Morgans AFSL 235410 / ABN49 010 669 726); with a passion for assisting people make informed financial decisions, as they navigate their way through retirement and aged care.
Disclaimer: While every care has been taken, Morgans Financial Limited makes no representations as to the accuracy or completeness of the contents. The information is of a general nature only and has been prepared without consideration of your individual objectives, financial situation or needs. Before making any decisions, you should consider the appropriateness for your personal investment objectives, financial situation or individual needs. We recommend you see a financial adviser, registered tax agent or legal adviser before making any decisions based on this information. Current as at 12 March 2024.
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