Should you get financial advice for aged care?

People are struggling with the cost and complexity of aged care – especially entering a nursing home – says Phillip Reid, Partner & Senior Financial Planner at Sydney Aged Care Financial Advisers.

He also appeared on our radio show last Sunday. He told us the demand for financial advice is growing as people realise a quick decision can jeopardise pensions, tax and family relations.

In the past 12 to 18 months, Phillip says more and more families have been selling the family home to fund going into care. He puts this down to new rules on renting out the home that were introduced by the Government on 1 January.

“The rent is now assessable [income]in terms of your aged pension whereas previously it wasn’t so it becomes less attractive from a cash flow perspective to keep the home,” he explains.

Expert help at hand

This is where an aged care financial adviser can help. They can work out what the scenario would be if you chose to keep the family home and rent it out, including the impact on your pension.

If you decide to sell, they can also advise on how to invest any surplus to support your care, or your parents’ care.

It’s also worth talking to your family and planning ahead – before the move into aged care.

Many families don’t realise they will need a power of attorney in place if they need to sell the home on behalf of an older parent. What happens if mum is no longer capable of signing the document? Legally, it becomes very messy.

“Families [need]to be a bit organised and ensure that they do have these things in place before it’s too late,” Phillip says.

The best thing you can do is pick up the phone – a financial adviser will quickly be able to tell you if they will be able to help. You can then come in for a meeting – with no obligation – to talk through your options.

You can listen to the podcast of the full interview with Phillip below:

Phillip Reid, Investment Advisor – 26.02.17