Most financial advisers have heard clients say, "I'm only leaving my home in a pine box." For many older Australians, remaining in their own home isn't simply a preference - it is an emotional and financial priority.
However, maintaining independence often requires increasing levels of support as health, mobility and confidence decline. Help with cleaning, meal preparation, transport, personal care and nursing can become an unavoidable part of later life. And this has a cost attached.
The introduction of the new Support at Home program under the Aged Care Act reinforces an important reality: future care costs are no longer simply an aged care issue but are now an essential component of retirement planning.
For financial advisers, this presents both an opportunity to improve client outcomes and a valuable way to deepen ongoing client relationships and add business value.
Why Support at Home matters
Retirement is not a single phase of life. Clients typically move through the three phases of retirement - active, quiet and frailty years - each with different financial needs.
Yet many retirement plans focus almost entirely on the first phase. Investment returns, superannuation drawdowns and age pension eligibility receive significant attention, while one of the largest potential expenses in later retirement - care at home - is overlooked.
The quiet and frailty years, on average, represent around half a person’s retirement years. If advisers are serious about helping clients remain financially secure throughout retirement, future care needs deserve a place in every retirement conversation. Planning only for the active years will leave clients underprepared and a potential burden on the family.
Understanding Support at Home
Support at Home has become the primary way older Australians receive government-funded aged care, with significantly more people accessing services in their own homes than those entering residential aged care.
One of the most common questions clients ask may seem simple - "How much is home care going to cost me?" But unfortunately, the answer is not simple.
Eligible clients are approved for a funding level based on an assessment of care needs across eight funding classifications, with the attached budgets ranging from approximately $11,000 to $80,000 per year. But this is not all free money, as the budget is a combination of government funding and client contributions.
The client contribution is based on which services they choose to receive, the cost of those services and a financial assessment. Once a client chooses a provider, an individual care plan is developed consisting of services across three categories:
- Clinical care (such as nursing and personal care)
- Independence support (such as transport and social support)
- Everyday living services (such as gardening, meal preparation and cleaning).
Clinical care is fully funded by the Government, but the other categories require client contributions as shown in the table below:
| Client contribution percentage of cost |
|
|
|---|
| Clinical care | Independence support | Everyday living |
Full (means-tested) pensioner | 0% | 5% | 17.5% |
Part pensioner & CSHC holder | 0% | 5%-50% | 17.5%-80% |
Self-funded or not means-tested | 0% | 50% | 80% |
For clients, their contributions represent a new and ongoing expense that needs to be incorporated into their retirement cashflow.
What could this look like?
Consider Agatha. Agatha and her husband are self-funded retirees, but Agatha’s declining health has meant they need to make life changes and decisions. They both still enjoy life but would benefit from extra support to care for Agatha.
Following an assessment through MyAgedCare, Agatha is approved for Support at Home Classification 5, providing a quarterly budget of $10,199 ($40,796 annually) to spend on care services. Working with her chosen provider, she develops a care plan which sees her quarterly budget spent as:
- Clinical care – $4,200
- Independence support – $3,000
- Everyday living – $2,999
Because Agatha is self-funded, she pays 50% of the cost of independence support and 80% of the cost of everyday living support. The couple will need to generate additional income of $3,899 per quarter ($15,597 per year) to pay her share of the costs.
If Agatha and her husband were full age pensioners, they would only contribute $675 per quarter. And if part-pensioners, it would be somewhere in between.
But is this enough?
One of the biggest misconceptions surrounding Support at Home is that government funding will cover all of a client's care needs – where, when and how they want. But the reality may be different.
Care services are expensive and funding is limited. If the provider charges an average of $120 per hour, Agatha’s budget will only cover around 6.5 hours of care a week – that’s less than one hour a day. For some people this will be sufficient. Others may need to compromise on the services they receive, rely on family support or contribute additional funds to purchase more care privately. Choosing providers carefully and being strategic on how to use the package may help to maximise the amount of care available.
Helping clients understand these trade-offs is where financial advice can deliver real value.
Building conversations into retirement planning
Advisers should not wait to have conversations about future care after the crisis - a fall, a hospital admission or a diagnosis of dementia. Be proactive and begin these conversations earlier, while clients still have capacity, options and time to plan.
Simple questions can open proactive conversations:
- How are you coping at home? Are you still able to achieve your life objectives?
- What are you worried about in the future?
- Who would help, if you need additional support?
- How would ongoing care costs affect your retirement income?
- What’s most important that you can continue to achieve, no matter what challenges you face?
- Are you interested in looking at care options that can help you maintain your independence?
These questions should be included as part of the conversation in every fact find meeting or ongoing client review. Clients want a safe space to explore these concepts – and starting with the kids often does not feel right for them.
A valuable business opportunity – get started
Support at Home advice is about much more than understanding the rules for calculating contributions. Advisers have the opportunity to have broader retirement conversations that strengthen client relationships and generate ongoing advice opportunities.
Clients are looking for someone who can help them:
- understand future care costs
- incorporate those costs into retirement cashflow
- determine whether existing retirement income is sufficient
- decide how much capital should remain available for future care
- balance spending today with maintaining financial flexibility for tomorrow.
Every retirement plan already assumes clients will grow older. The question is whether it also prepares them for the financial consequences of growing older.
Advisers who become comfortable discussing these issues are likely to deepen client relationships, improve retention and differentiate themselves in an increasingly competitive retirement advice market.
You don't need to become an aged care specialist overnight. A practical starting point is to:
- Build your understanding of the Support at Home program and how client contributions are determined.
- Introduce future care questions into every retirement review.
- Incorporate potential care costs into retirement cashflow modelling so clients understand how future support may affect their long-term financial security.
Remember Support at Home conversations are about helping the client stay in control, to maximise their quality of life without the family burden. Are you ready and willing to have The Burden ConversationTM with your clients?
This article has been provided by Louise Biti, a director and co-founder of Aged Care Steps.
Disclaimer: This document has been prepared by Aged Care Steps Pty Limited, ABN 42 156 656 843 AFSL 486723, based on our understanding of the relevant legislation at the time of writing. While every care has been taken, Aged Care Steps Pty Limited makes no representations as to the accuracy or completeness of the contents. The information is of a general nature only and is intended for use by financial advisers and other licensed professionals only it does not take into account individual situations for clients. © Aged Care Steps Pty Limited, 2026.
Louise Biti Director at Aged Care Steps, leading professional advisers to upskill and provide aged care advice
