Aged Care Calculations Made Simple

Tuesday, April 26, 2016

We have a steady flow of inquiry at our office regarding aged care – it’s technically part of good Estate Planning and is commonly a daunting task for people.

A typical scenario would be of an elderly family member who had been managing quite well with their day to day living and an event occurs that renders them in need of long term care. It may be a fall, a stroke, the onset of dementia, or some similar debilitating situation.

Changes occurred in the structure of aged care several years ago that has made it more a "user pay" area. The new system on the surface looks difficult to work through, however if you follow a process and make inquiry it certainly isn’t insurmountable. Remember not to get baffled by the acronyms - they are something dreamed up by a government Boffin!

If this ends up being thrown in your lap just take a deep breath and follow these five basic steps. Also there is website provided by the Federal government and this will give you some tips and the calculations which can all be done for you at the click of a button at

The first step is to have an assessment done by an ACAT (Aged Care Assessment Team).

Then locate a suitable facility – there is a list available on the website. It’s best to work out which ones seem to suit and then visit them and get a feel of the amount of care offered to help make your decision. Thirdly you need to work out the cost of the daily care rates, referred to as DAF or ‘Daily Accommodation Fees’. This is where the website is very handy.

Once you have followed these steps and are happy, at this stage you might want to check you are across everything financially and a financial planner would be the place to go. If you, or the person concerned, have a financial planner they should offer this as part of their client service, if not maybe a small fee. We find we assist a lot of people in this regard.

Fifth and last you need to complete the relevant forms and may need assistance with this.

It’s not as bad as it first looks but is another great example of why it is always advisable to use a financial planner in retirement right from the outset.

for a more detailed explanation click here