Affording your preferred aged care facility

Have you found the aged care facility (nursing home) to suit your needs but not sure if you can afford it?

It’s a common concern for those considering their options and Affinity Aged Care Senior Adviser Don Swanborough says people often overlook their preferred aged care facility (nursing home) because they don’t think they can afford it.

“The good news is that people now have for more flexibility in how they make their Residential Accommodation Deposit (RAD) for their preferred facility,” Don said.

He said aged care reforms made in July 2014 meant there were now three options available to pay the RAD advertised by the facility.

The most obvious is to pay the full RAD advertised by the facility, which is fully refundable when a person leaves.

Another option is to pay interest only on a RAD, called a Daily Accommodation Payment (DAP).

“A Daily Accommodation Payment allows you to pay just the interest on an unpaid RAD, which is currently 6.28 per cent per annum.”

The third option is to use a combination of these options by initially paying a partial Residential Accommodation Deposit and then making Daily Accommodation Payments on the balance.

“This option allows you to use the funds you have to pay part of the RAD, which then reduces the DAP,” Don said.

Don said that ultimately, the decision on how to pay a RAD depends on an individual’s financial circumstances and whether there are sufficient assets to allow them to afford their preferred facility.

“A major factor is often the value of a person’s home and the sale prospects for that house – if both these factors are positive, an arrangement can usually be worked out with the facility to afford the accommodation payment.

“Of course like any major financial decisions, it is crucial to seek professional aged care financial advice when evaluating aged care options.”


Affinity Aged Care Financial Services

9/60 Carrington St, Sydney NSW 2000
02 8078 0888
[email protected]

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A special thanks to our contributors

Jill Donaldson


Jill has been practicing as a clinical physiotherapist for 30 years. For the last 13 years she has worked solely in the Aged Care sector in more than 50 metropolitan and regional facilities. Jill has also toured care facilities in the US and Africa and is a passionate advocate for both the residents in aged care and the staff who care for them. She researches and writes for DCM Media.

Chris Baynes

DCM Media, agedcare101

Chris has been a journalist and publisher in the retirement village and aged care sectors for 11 years. He has visited over 250 retirement villages and 50 aged care facilities both within Australia and internationally. Chris is a regular speaker at industry conferences plus is a frequent radio commentator.

Annie Donaldson

Nurse and Carer

Annie has a long career in both nursing and the media. She has planned and co-ordinated the medical support from both international TV productions and major stadium events. In recent years she has been a primary family carer plus involved in structured carer support.