Aged care costs — what will you actually pay?

Aged care costs in Australia are means tested — what you pay depends on your income, your assets, and the type of care you need. This guide breaks down the main costs in plain language.

The family home — the most important thing to understand

Home care costs (Support at Home)

Two components:

• Basic daily fee: approximately $12.86/day. Everyone pays this.
• Income-tested fee: calculated by Services Australia based on income. The family home and most assets are excluded from this calculation.

Indicative annual out-of-pocket costs by financial situation:

• Full Age Pension, limited assets: approximately $4,700/year in fees (basic daily fee only)
• Part pension with modest savings: $5,000–$8,000/year
• Self-funded retiree with significant income: $8,000–$15,000+/year

These are net costs — the government pays the rest of the Support at Home budget.

Residential aged care costs

Three components:

1. Basic daily fee: approximately $65/day (~$23,725/year) — everyone pays this. Indexed to the Age Pension.

2. Means-tested care fee: based on both income and assets (unlike home care). Capped at approximately $35,000/year and $75,000 lifetime. If you have limited assets and pension income, this may be nil or very low.

3. Refundable Accommodation Deposit (RAD): a lump sum paid to the facility. The RAD is refundable when you leave care. If you entered care before 1 November 2025, your RAD remains 100% refundable. If you entered care on or after 1 November 2025, the RAD balance is reduced by 2% of the amount paid each year for the first five years — a maximum retention of 10%. The balance can also be reduced if you agreed to have ongoing fees deducted from your RAD. Typical range in metro areas: $350,000–$750,000+. If you cannot afford the RAD, you can pay a Daily Accommodation Payment (DAP) instead — approximately 8% of the RAD amount per year. You can also split: partial lump sum + ongoing DAP.

Rules current as at November 2025. Always verify current rates with My Aged Care or a financial adviser.

Who pays very little

If someone receives a full Age Pension with limited assets (and the family home is occupied by a qualifying resident), they may pay only the basic daily fee for home care and residential care. The system is designed so financial position does not determine access to care.

Getting a formal fee estimate

Call Services Australia on 1800 227 475 to request a fee estimate. You'll need income and assets details. An aged care financial adviser can also model different scenarios — look for an adviser who specialises in aged care.