Choose a home with a high RAD?

My grandparent needs to go into an aged care facility. Her home is worth $1,000,000 roughly. Is it best to find an aged care home with a high RAD in this case, like between $750,000-$1,000,000, rather than going for a lower RAD of $500,000 and having money left over? If we go down that route, is her pension less likely to be affected? If she paida smaller RAD of $500,000 and had $500,000 left over how would that affect her pension?

Thanks for that. We understand getting her the best home, but it had never even entered our mind to even look at the larger costing homes, because they seemed a bit out of reach, even though the “house sale” could cover it. The average range is $500,000 and below so we just instinctivelywent looking for those, thinking there was a catch for the larger deposit homes. We would always endeavour to find her the best home that would suit her and make her feel at home. This is are the first priority, I can assure you. Thanks for your

The wonderful Robert Craven from Affinity Aged Care has come back with the below advice.
First and foremost, I would suggest that you should be looking for an aged care facility that is the most suitable for your grandmother. Try to find one where she would feel most comfortable, possibly close to you so she will get plenty of drop-in visits. These regular family contacts are so important for an elderly person who moves to an aged care facility. The financial outcome should be a secondary consideration. Your grandmother owns a million dollar home so she can afford to move to almost any aged care facility in Australia.

That said, if she moved to a room with a $500,000 RAD and her only other asset was a bank account with a $500,000 balance, her pension would drop from $894.40 per fortnight to $680.38 per fortnight. However, she would have $500,000 in a pensioner savings account earning interest at the rate of circa $330 per fortnight. Under this scenario, she would also be means tested care fee of approx. $47.30 in addition to the basic care fee of $49.42 per day.

If she moved to a room with a $750,000 RAD, assuming no other assets other than a bank account with a $250,000 balance, her pension would increase to $836,63 per fortnight but her interest earnings from her bank account would reduce to circa $165 per fortnight while her means tested care fee would reduce to approx. $41.70 per day.

First things first. Find a suitable facility and then contact a specialist aged care adviser who will assist you to work through the complex financial maze to get the best financial outcome for your grandmother and her family.

We hope that helps,
the agedcare101