News » A guide to planning for aged care

A guide to planning for aged care

The latest Inter-generational Report tells us that Australians aged 65  years and over accounted for 14% of the population – and that figure is rising. Whether you’re concerned about your future self or a loved one, aged care is an issue most of us will have to manage at some time in our lives. 

At the time of Federation, Australians at birth had an average life expectancy of around 55 years. The most common causes of death were infectious and parasitic diseases resulting from unsanitary sewerage and water systems, poor quality food and limited health education.

Improvements in public sanitation, health and medicine have seen lower death rates and longer life expectancies. Enhanced living standards meant we began living longer, cancer and heart disease became our most common cause of death.

The latter part of the 20th century witnessed substantial advances in medical treatment, which reduced the impact of these diseases and further increased Australians’ life expectancy.

Given mounting pressures on governments to assist an aging population, more Australian families are taking the support of elderly loved ones into their own hands – and this is where it pays to do early homework.


Illness, disability or the passing of the years can make it difficult for you or your loved one to maintain an independent lifestyle.

The ideal is to remain in one’s own home for as long as it is reasonable and safe, but knowing when independence is no longer feasible is the difficulty.

Your first step is a visit to your doctor to discuss you or your loved one’s situation. If necessary, your doctor can refer you to an Aged Care Assessment Team (ACAT).

The ACAT consists of appropriately qualified people usually based at a local hospital. They can visit the elderly person in their home and, following a government-approved guideline, assess how much and what type of care may be required.

Levels of care

Care options include in-home care and residential care providing standard accommodation and personal services. Residents pay for optional additional services.

In-home Care

Four levels of care:

  1. Basic
  2. Low level
  3. Intermediate
  4. High

Best suited for:

Elderly personal capable of living safely and independently in their own home.

What it includes:

Actual services included depend on the level of care, but include some or a combination of the following:

  • Personal care – showering, dressing, grooming, etc.
  • Errands – grocery shopping, bill paying, visiting friends, laundry, washing and ironing, etc.
  • Meal preparation
  • Companionship – outdoor activities, reading, letter writing, assisted exercise, etc.
  • Nursing, allied health and other clinical services – these services are included under Levels 3 and 4 as more complex clinical needs.

What it costs:

The cost to the client depends on the means tested income of the client as well as the level of care provided.

The government provides subsidies for home care, but basic fees apply in line with the age pension.

Those on incomes in excess of the age pension may be required to pay more.

Maximum fees payable are determined by the level of care required and other living expenses: rent, utilities, pharmaceutical, etc.

Residential Care

Best suited for:

Elderly person not able to live safely in their own home or who, due to illness, disability and/or frailty needs continuous care.

What it includes:

Accommodation services – including bedding, laundry, meals, cleaning and toiletries, building maintenance and daily activities.

Personal care assistance – including bathing, eating, dressing, moving, communicating, administering medicines and arranging health care appointments.

What it costs:

Fees apply to all residents of care facilities, depending on level of care and ability to pay.

Fees include:

  • Basic daily fee – covers living expenses, meals, laundry, etc.
  • Means tested care fee depending on income and assets
  • Accommodation cost – based on income and assets
  • Fees for extra or optional services.

Points to note:

  1. Government assistance packages are available. New residents undertake an assets test conducted by Centrelink or Department of Veterans’ Affairs to determine eligibility.
  2. Accommodation costs can be paid as a lump sum refundable deposit, a regular rent-type payment or a combination of both.

Planning and preparation

Statistics forecast an increasingly aging population – a challenge for any government. Consequently, future generations may not have access to current levels of government subsidies.

According to the Australian Bureau of Statistics, a man now aged 65 could live to be 84 years old – a woman could see 87.

While Australians have embraced the concept of self-funded retirement, we evidently need to start considering those decades beyond.

Could your superannuation support you for twenty-plus years – including funding the level of aged care you might need? Could you afford the additional expenses if your partner remained in the family home while you moved into aged care facilities?

We can assist you to prepare a strategy that helps you afford the care you or your loved one might need, from help around the home to more substantial care.

Living long enough to receive a letter from the Queen is one thing – affording it is another!

It’s all in the planning.