For many downsizers, aged care can feel like a conversation for “later.” You might be fit, independent, and enjoying your freedom — and “care” sounds like something that only applies when you’re much older. But what if your next move could be your last? What if future-proofing your downsize meant you could have aged care delivered — on your terms, in your home, and without nasty financial surprises?
From 1 July, the cost of aged care in Australia is changing. And the numbers may be eye-watering.
Let’s break it down.
What you think aged care costs — and what it actually might
You’ve probably heard about the basic daily fee — currently $64 per day — but that’s just the starting point. When it comes to the cost of residential aged care how much you’ll pay for your room, meals, and care services depends on your assets and income — and new means testing rules coming into effect this year could see you paying far more than you expect.
Here’s a snapshot of what it could cost:
- 🏠 The market price cap for a room in residential aged care is $750,000 — and many are priced right at that cap with some even higher.
- 💰 If your assets are over $206,663, you will need to pay the market price, or pay interest on any unpaid portion.
- 📈 Daily payments are charged at 8.17% per year, and from 1 July a 2% annual exit fee(capped at 10%) will apply to lump sums.
A case study: Pensioner vs self-funded retiree
Let’s say you’re a pensioner with $320,000 in assets. If a residential aged care room costs $750,000, and you Let’s say you’re a pensioner with $320,000 in assets. If a residential aged care room costs $750,000, and you pay $250,000 as a lump sum:
- You’ll still need to pay around $40,850 per year in daily accommodation payments.
- Add to that the basic daily fee ($23,294) and a hotelling supplement ($5694).
- Before any extras like a glass of wine or a haircut, that’s nearly $70,000 per year.
If you’re a pensioner with a bit of savings — Income of around $44,400/year — you’re facing a shortfall of more than $25,000/year.
Now imagine you’re a self-funded retiree with $1 million in assets. You’ll pay even more, with an additional “non-clinical care” contribution that can push your annual aged care bill past $100,000.
So, what does this have to do with downsizing?
Everything.
If you’re planning your next move — to a smaller home, a retirement village, or a lifestyle community — now’s the time to think about how you might want care delivered later. Aged care does not necessarily mean the traditional nursing home, there are more options available for you to age in place in your own home. What’s more important, is knowing how much your future care might cost and crunch the numbers. It could save you money, stress, and heartache down the track.
Future-proof your downsize
At Downsizing Made Simple, we believe the best time to plan for aged care is before you need it.
That’s why our resources — from checklists and calculators to the Village Guru Report — are designed to guide your decisions now. Whether you’re comparing village contracts, checking your rent assistance entitlements, or exploring ways to bring care into your home, you’ll find the clarity you need to move forward with confidence.
The new means test rules mean it’s more important than ever to crunch the numbers and consider getting expert financial advice — especially if you’re selling the family home.
Your next move could be your last — make it the right one
Don’t let aged care catch you off guard. Explore your downsizing options with confidence — and make sure your next home is one that can adapt with you.
Want to downsize without regrets?
➡️ Find a Village that offers a free Village Guru Report
🧮 Use our retirement living calculators to explore your options
👥 Connect with a Retirement Living and Aged Care Specialist adviser to help navigate the numbers
📞 Call us on 1300 855 770
