How do I get aged care financial advice?
Get advice early, before you or your parent signs anything. Aged care costs depend on the room price, your income and assets, and when you move in. Choices made at the start can be hard to undo.
In brief
Get advice before you or your parent signs any agreement with an aged care home.
Fees depend on when someone moved into permanent care: on or before 31 October 2025, or from 1 November 2025.
You can pay for the room as a lump sum, a daily payment or a mix of both.
Keeping, renting or selling the family home each affect the Age Pension and aged care fees differently.
Existing additional and extra service fee agreements end on 31 October 2026.
Good advice comes in writing and models each option using the actual room price.
In this article
In this article, Tracy Wan, Senior Financial Adviser at Aspire2 Wealth, explains how to get aged care financial advice in WA, what good advice covers, and how the fee rules work across Australia.
The most important thing I tell families is that it's never too early to start the conversation. Many only come to us after a crisis, like a fall or a hospital stay. By then, they're making big decisions under a lot of pressure.
In Western Australia (WA), the fee rules are the same as in every other state, because federal law sets them. The new Aged Care Act turns one on 1 November 2026. Here are the questions families ask us most, and our answers.
The questions families ask us
A typical enquiry comes from an adult child helping a parent move into care. Mum owns her home. She also has cash savings, super and shares. The family wants to know:
Should she pay for her room with a lump sum, a daily payment or both?
Should she keep, rent or sell her home?
What fees will she pay, and what happens to her Age Pension?
How will her money hold up over the next one, three and five years?
Who can give this advice, and what will it cost?
Here is what you need to know about each one.
What should I know before getting aged care advice?
Before you see an adviser, it helps to gather a few things:
a list of your income and assets
details of your home, super and investments
letters about any pension or other payments you receive
your My Aged Care assessment paperwork, if you've already been assessed.
Talk with your family, too. When everyone is on the same page, things go much more smoothly.
Make sure your legal documents are in order, especially an enduring power of attorney. If you can't make decisions yourself, the person you trust will need the authority to act for you. Talk to a lawyer about your will and powers of attorney. They are legal documents, so get independent legal advice before you make or change them.
Try not to make a major decision before you get financial advice. Selling the home or signing an aged care agreement too quickly can affect your fees and Age Pension in ways you may not expect. My Aged Care and Services Australia are a great place to learn how the rules work, but they can't tell you what's right for you. That's where personal advice comes in.
What changed on 1 November 2025
The fee rules depend on when you moved into permanent care, according to the Department of Health, Disability and Ageing.
In care on or before 31 October 2025. Your fee arrangements stayed the same, unless you chose to opt in to the new ones.
Moved in on or after 1 November 2025. The new fee arrangements apply. The rest of this article explains them.
Residents must now report changes to their personal and financial circumstances within 28 days. This keeps their fees correct.
Paying for the room: RAD, DAP or both
Every resident agrees a room price with the aged care home before moving in. If your means assessment shows you aren't eligible for government help, you pay that price in one of three ways, according to My Aged Care.
A refundable accommodation deposit (RAD). A lump sum. The balance is refunded when you leave the home.
A daily accommodation payment (DAP). This works like rent. It isn't refunded.
A combination of both. For example, on a $500,000 room price, you could pay $200,000 as a lump sum and a smaller daily payment on the rest.
The DAP is worked out from the room price. Multiply the room price by the maximum permissible interest rate (MPIR), then divide by 365. The government sets the MPIR. DAPs are indexed on 20 March and 20 September each year.
Four points to know before you choose:
You can't be asked to choose a payment option before you move in.
Until you pay a lump sum, you pay daily payments.
Your provider must deduct retention amounts from a RAD, and these aren't refunded. You can also ask the provider to take your daily payments out of the RAD.
A lump sum counts as your asset in the aged care means assessment, even if a family member pays it.
The right mix depends on your cash flow, your pension and what you want to leave your family. That is why advice should model each option using the actual room price.
What fees will Mum pay?
For residents who moved in from 1 November 2025, costs fall into five groups, according to the Department of Health, Disability and Ageing.
A basic daily fee for everyday living, such as meals and cleaning. Everyone pays it.
A hotelling contribution. This is means-tested and goes towards everyday living services. It has no annual or lifetime cap.
A non-clinical care contribution. This is also means-tested. It covers things like help with bathing, mobility and lifestyle activities. It stops once you reach a lifetime cap, or after 4 years of paying it.
Accommodation costs, paid as a RAD, a DAP or both.
An optional higher everyday living fee (HELF) for extra services you choose.
The government pays for clinical care in full. Services Australia works out your means-tested contributions after a means assessment. The amounts and thresholds change every March and September, so we haven't quoted figures here.
The costs often come as a surprise. The government still covers a large share, but under the new rules it expects around half of new residents to pay more than they would have before, according to its response to the Aged Care Taskforce. That's where advice helps. We look at your whole situation, work out the most affordable way to structure things, and help protect what's left for the rest of the family.
Keep, rent or sell the family home?
There is no single right answer. Each choice affects the Age Pension, aged care fees and your estate in a different way.
Keep it. For the Age Pension, your former home is exempt from the assets test for 2 years from the day you enter care, according to Services Australia. If your partner still lives there, it stays exempt. After 2 years, a home you haven't returned to usually becomes an assessable asset.
Rent it out. The home can still be exempt for those 2 years. But the net rent counts as income for the Age Pension, and rental income can also affect your aged care fees.
Sell it. The sale money generally counts as an asset for the Age Pension. Any part you pay as a RAD is exempt from the Age Pension assets test. It still counts in the aged care means assessment.
Keeping or selling the home also changes what is in Mum's estate. And if someone needs to sell or rent the home for her, they need legal authority to act. In WA, that is an enduring power of attorney. I explain how it works in my article How do I start estate planning?
How aged care affects the Age Pension
The Age Pension and aged care fees use separate tests. One decision can change both.
A RAD is exempt from the Age Pension assets test, according to the Department of Social Services, but it counts towards your aged care fees.
Your former home is exempt from the Age Pension assets test for 2 years after you enter care.
Assets that aren't exempt, such as cash and shares, still count.
This is why advice should show the combined effect on your pension, your fees and the money you have left.
A deadline to watch: 31 October 2026
Before the new Act, some residents signed agreements to pay additional service fees or extra service fees. These agreements can continue until 31 October 2026. Any still in place on 1 November 2026 will stop having effect, according to the Department of Health, Disability and Ageing.
They are replaced by the optional HELF. A HELF agreement must be separate from the other care agreements, and it can't be a condition of entry. There is a 28-day cooling-off period after signing. If your parent pays additional or extra service fees, ask their aged care home what happens next.
What written advice should include
Personal financial advice comes in writing, in a document called a Statement of Advice (SOA). For aged care, ask for advice that:
calculates the RAD, DAP and combination options using the actual room price
shows each fee, how it is worked out and when it changes
shows the effect on the Age Pension
compares keeping, renting and selling the home
projects your position over time, for example over 1, 3 and 5 years, including cash, home equity, investments, income and total care costs
checks that your will, super nominations and enduring powers still fit. Your lawyer prepares or updates your will and powers of attorney, so talk to them before you change anything.
Questions to ask any adviser
Are you licensed? Check the Financial Advisers Register on Moneysmart. An adviser who isn't on it can't legally give personal advice on investments, super or life insurance. The register also shows which products an adviser can advise on.
Does your authorisation cover aged care advice? Ask, and read the adviser's Financial Services Guide (FSG).
What will it cost? Your adviser must explain their fees before you agree to anything. Fees may include a fee to prepare your SOA, a fee to put the advice in place and an ongoing fee.
Are there commissions or other links? The FSG sets out the adviser's services, fees and any links to financial products.
How often do you advise on aged care?
Can you work with my family, my lawyer and my accountant?
Moneysmart, from the Australian Securities and Investments Commission (ASIC), has more guidance on choosing an adviser and understanding advice fees.
How we work
Your first consultation is complimentary. We start by listening to what's happening for you and your family. Then we look at your whole situation, including your income, assets, the family home, super and the Age Pension, and model each option using the actual room price. We explain our fees before you agree to anything, and your advice comes in writing in a Statement of Advice. We can also work with your family, your lawyer and your accountant, so everyone is on the same page.
Free government help
My Aged Care is the starting point for assessments and information. Call 1800 200 422.
Services Australia's Financial Information Service (FIS) is free. Its officers can explain aged care costs and how your choices could affect your pension. Call 132 300 and say 'Financial Information Service'.
FIS officers give information, not advice. My Aged Care itself recommends independent financial advice before you decide how to pay for care.
Common questions
When is the best time to get advice?
Before a crisis, and before signing any agreement with an aged care home. Advice is most useful while you still have choices.
Can the RAD be paid for your parents?
Yes. You or another family member can pay it. But the lump sum still counts as your parent's asset in their aged care means assessment.
Mum moved into care before November 2025. Does anything change for her?
Her fee arrangements stay the same unless she opts in to the new ones or leaves care permanently for more than 28 days. If she pays additional or extra service fees, those agreements end on 31 October 2026.
Book a complimentary consultation
If you or your parents are thinking about aged care, a conversation now can save stress later. Call our team on (08) 9322 7029 or book a consultation. Read more about our aged care advice.
You can also read about our retirement planning and estate planning advice, or book a complimentary consultation with Tracy.
Planning further ahead? Damon's article How much do I need to retire in Australia? covers the bigger retirement picture.
Sources
My Aged Care, Understanding aged care home accommodation costs
My Aged Care, Financial support and advice
Department of Health, Disability and Ageing, Accommodation payments and contributions for residential aged care
Department of Health, Disability and Ageing, About fee and accommodation arrangements
Department of Health, Disability and Ageing, Means tested fees for residential aged care
Department of Health, Disability and Ageing, Means assessment for residential aged care
Department of Health and Aged Care, Response to the Aged Care Taskforce: residential care contributions, September 2024
Department of Health, Disability and Ageing, Letter to residents: new Aged Care Act and your fee arrangements, October 2025
Department of Health, Disability and Ageing, Additional or extra service fee agreements
Department of Health, Disability and Ageing, Higher Everyday Living Fee fact sheet, September 2026
Services Australia, Annual, lifetime and time limited caps for aged care
Services Australia, Assessment of the principal home when entering a care situation
Services Australia, Vacation of home to enter care situation
Services Australia, Exempt assets
Department of Social Services, Social Security Guide 1.1.R.113: Refundable deposit
Department of Social Services, Social Security Guide 4.6.3.70: Exempting the principal home, care situations
Moneysmart, Financial advisers register
Moneysmart, Financial advice costs
Moneysmart, Getting financial advice
Services Australia, How FIS can help: Aged care
Aspire2 Wealth Advisers Pty Ltd ABN 42 125 897 903 is an authorised representative and credit representative of Charter Financial Planning Limited ABN 35 002 976 294, AFSL and Australian Credit Licence No. 234665. This website contains information that is general in nature. It does not take into account the objectives, financial situation, or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information.
