The conversations of life

Receiving a pension in aged care when one partner is still working – a balancing act


This question has come up a lot on our agedcare101 forum and it’s an issue that affects hundreds of families – so here’s some information that might come in handy if you and your partner have found yourselves in this situation.

Here’s the basic scenario:

A member of a couple has moved into an aged care home and is receiving an Age or Disability pension – depending on whether that person is living with dementia or any other medical condition – which will cover their care fees at 85 per cent.

The other member of the couple (the primary carer) may have been receiving a Carers pension up until this point, but now needs to return to work in order to maintain their income.

The problem comes in when the Age/Disability pension is directly reduced by a partner’s earnings, and sometimes voided completely. The working partner is then left to pay the aged care facility fees in full – leaving them little to live on.

Now, this is obviously a very complex process and everyone’s situation is different, so the first step is to seek out a financial planner with extensive experience in the aged care system.

Their expertise will be invaluable as many people in the Government departments may not have a complete understanding of all the complicated nuts and bolts.

We can recommend Affinity Aged Care Financial Services and Sydney Aged Care Financial Advisors.

You may then want to ask your financial advisor about the possibility of applying for recognition as a couple “living separately and apart” – a term in the Aged Care Act where “one member of a couple is institutionalised due to a severe and debilitating condition” (e.g. dementia).

You will need to complete a MOD-S form (which can be downloaded from the Centrelink website) to apply for this. However, if you are approved, it means that your assets can be separated so that one person’s income does not impact the other’s pension.

Again, it’s important you speak to a financial advisor about whether this could be appropriate for your situation – but we hope it’s a helpful starting point.

You can read more about this topic on our forum here.

With a background in nursing, Annie has spent over 20 years working in the health industry, including the coordination of medical support for international TV productions and major stadium events, plus education campaigns with a number of national health organisations. In recent years, she has also taken time out of the workforce to be a full-time carer, giving her first-hand experience of the challenges and rewards of this role.

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