Loans from family to fund a RAD have impacts on the cost of care and potentially estate planning. The Aged Care Act 1997 does not preclude a family member of a resident making a contribution towards their accommodation payment. However, an aged care provider must not accept a lump sum payment which would leave the resident with less than the minimum permissible asset level within 28 days of entry and the provider has sufficient information to know the person’s means.
Post 1 July 2014 a person's ability to contribute towards the cost of their accommodation and care is subject to a means test which incorporates both assets and income. Refer to Residential Aged Care Means Test Factsheet. The reforms removed the distinction between low care and high care, creating a single payment structure for aged care residents.
Retirement villages are generally built as a group of units or villas with entry restricted to people who are over 55 and retired from full-time employment. Retirement Villages operate under the relevant state or territory legislation, often called the Retirement Villages Act.
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