The good news is that you may not need to find the money or cash your investments to pay this full amount as a lump sum.

When moving into residential aged care, you will be given a choice on how you pay for your accommodation. You can pay the full amount as a lump sum, known as a Refundable Accommodation Deposit (RAD), or pay a Daily Accommodation Payment (DAP), or you can choose a combination.

So, where do interest rates come into it?

If you choose the daily payment option, the amount you pay is calculated by converting the lump sum into a daily fee using a government-set interest rate called the Maximum Permissible Interest Rate (MPIR). When official interest rates increase, this flows through to a higher MPIR which currently sitting at 8.43% per annum – considerably higher than just a few years ago.

The rate is locked in when you enter care (unless you move rooms) but the higher current rates may change affordability and funding decisions for families now looking at care options. A strategy that may have made sense when interest rates were low may no longer be the most cost-effective approach today.

Under the current rules, you also need to take into account the impact of inflation-linked indexation each six months if you choose the daily payment option.

Make it your choice

One of the biggest misconceptions we still encounter is that the aged care provider decides how accommodation must be paid. Providers can set the room price, and some may prefer a lump sum, but the choice is yours.

You have the right to decide whether to pay a lump sum, a daily payment, or a combination option. Most people start with a daily payment and then if they choose, can pay the lump sum (in full or part) at any time after entry.

Because these decisions can have a significant impact on your cash flow, age pension, investments and even the value of your estate, it’s worth taking the time to seek advice before making a commitment.

Every family’s financial situation is different. Understanding your options and developing a strategy that suits your circumstances can help you make the most of your available resources and provide greater peace of mind during what is often a significant life transition.

The right advice won’t change the interest rate, but it can help ensure you’re paying for aged care in the way that’s right for you.

We offer licensed and specialist aged care advice, to help you make the right choices. If you’d like to talk through your situation or understand your next steps, book a conversation with our team to discuss your situation.

The post Why higher interest rates could make aged care more expensive appeared first on Direct Advisers.

But one of the greatest risks to that legacy can be the challenge of dealing with sudden wealth. When adult children inherit large sums or significant assets without preparation, sometimes the result is family tension, poor decisions or erosion of wealth.

While precise figures vary, research and industry experience consistently show that many families struggle to preserve wealth beyond the second and third generations, largely due to behavioural and governance challenges rather than investment performance.

Building financial literacy

Financial capability is developed over years of exposure, education, and experience.

The Australian Securities and Investments Commission (ASIC) MoneySmart program emphasises that financial literacy is a core life skill, not simply a technical ability.

While an inheritance may be some years off, parents who are expecting to pass on some form of an inheritance, should begin involving their children in financial discussions where appropriate. This might include reviewing investment portfolios together, explaining the complexities of how superannuation works or discussing the rationale behind major financial decisions. Understanding how risk is associated with investing, and ongoing tax obligations is also essential to create the whole picture.

Practical experience is just as important as theory. Allowing adult children to manage a portion of investments, under guidance, can build confidence and accountability. This phased approach reduces the risk of overwhelm later, when financial responsibility increases significantly.

Gifting or loaning?

Another important consideration when supporting the next generation is whether to provide financial assistance as a gift or a loan. The decision has both ethical and practical implications.

Gifting can provide immediate support without the burden of repayment, allowing children to purchase a home, invest or establish a business. But unequal gifting among siblings may create perceptions of favouritism, even if the intention is fair. Clear communication and documentation of the reasoning behind decisions is essential.

Loaning, on the other hand, can maintain a sense of responsibility and fairness.

Loans structured with clear terms can encourage financial discipline and avoid creating dependency. Families often formalise the arrangements with written agreements that set expectations for repayments and interest. There are also taxation and legal considerations.

The Australian Taxation Office may assess certain arrangements differently depending on whether funds are genuinely gifted or loaned. Professional advice ensures that intentions are reflected correctly. Ultimately, the choice between gifting and loaning may come down to the financial maturity of the recipient and your estate plan.

Preparing the next generation beyond money

Financial preparation alone is not enough. Inheriting wealth also involves emotional and behavioural readiness.

Open conversations about wealth, values and expectations are important. This includes explaining the purpose of wealth, whether it is to provide security, support philanthropy or create opportunities for future generations.

Governance structures, such as family meetings, investment committees or advisory boards can also help heirs understand their roles and responsibilities and encourage collaboration.

Philanthropy is another powerful tool for preparing heirs. Involving children in charitable giving decisions can instil a sense of social responsibility. It reinforces the idea that wealth is not solely for personal use, but also a resource to benefit the broader community.

Managing the transition

Gradual transition strategies can ease the adjustment for both parents and children.

This might involve progressively transferring control of assets. For example, adult children may first participate in decision-making, then take on increasing responsibility for managing investments over time. Trust structures are often used for staged distributions, allowing flexibility and protection.

Regular reviews are equally important. As family circumstances change, so too should the plan. Marriage, divorce, business ventures or health issues can all affect how wealth should be managed and transferred.

A legacy of capability

Successful intergenerational wealth transfer is not measured by the size of the inheritance but by the preparedness of those who receive it. Financial literacy, decision-making and open communication are the foundations of lasting wealth. By investing time in educating and including the next generation, families can reduce the risks associated with sudden wealth and create a legacy that endures.

If you’d like to discuss how to prepare your family for a successful wealth transition, we’re here to help. Contact our team here.

The post Investing for the next generation appeared first on Direct Advisers.

That’s why your financial strategy shouldn’t be static. It shouldn’t be one-size-fits-all. Instead, it should evolve with you adapting as your life shifts from one milestone to the next.

As Ursula Boorman, Managing Director of Direct Advisers, explains:

“Life’s Transitions don’t just happen to others, they can happen to any of us. The financial choices you make today will shape your next chapter. Advice isn’t about predicting the future, it’s about preparing for it with confidence.”

Transitions Are Universal — But Often Under-Prepared For

Major life events bring emotional and financial complexities. Yet many Australians feel they’re navigating these transitions without the confidence they deserve.

According to AMP’s Retirement Confidence Pulse (2025):

• Only half of Australians feel confident about their retirement prospects.
• Confidence is significantly lower among women and those experiencing separation or life changes.
• People in their 40s, often balancing care for children and ageing parents, report the lowest confidence levels overall.

These data points reflect the reality that even well-intentioned plans can fall out of step with life’s circumstances, especially when expectations shift.

Advice Matters at Every Milestone

Financial advice isn’t just for the wealthy or retired. It plays a valuable role at every stage of life — from building a foundation early in your career to pivoting after separation, to protecting what you’ve worked so hard to build.

The Value of Advice Consumer Research (2025) by the Financial Advice Association of Australia (FAAA) highlights the benefits:

• Australians with financial advice consistently report higher financial confidence
• They experience lower stress about money
• Advice helps households stay focused on long-term goals, even through uncertainty
• And people say it gives them more clarity and control over their future.

This isn’t just numbers, it’s wellbeing.

Life’s Transitions, The Direct Advisers Approach

At Direct Advisers, we call this phase Life’s Transitions. The journey isn’t just about super balances, investments, or insurance, it’s about you and the realities of the life you’re living now.

Our dedicated Life’s Transitions page outlines how we support clients through:

• Separation and divorce
• Loss of a partner
• Caring responsibilities
• Career change or redundancy
• Retirement planning
• Estate and legacy decisions

Each transition brings practical questions and emotional weight and a well-timed conversation can make all the difference.

Final Thought: Plan for Life, Not Just the Numbers

Transitions are inevitable. Feeling uncertain doesn’t have to be.

The power of advice lies in its ability to evolve with you helping you make confident choices through change, safeguard what matters most, and embrace your next chapter with purpose.

If you’re facing a milestone, big or small, taking a proactive step now can bring clarity tomorrow. You don’t need to have all the answers; you just need someone on your side to help you navigate the questions.

Ready to begin your next chapter with confidence?
Reach out to the team at Direct Advisers for a Life’s Transitions conversation that respects your goals, your story, and the life you want to build.

The post Life’s Milestones and Transitions: Your Strategy Should Evolve With You appeared first on Direct Advisers.

For some, it is about unpacking boxes of decorations, preparing familiar family recipes and racing around the shops. For others, it is time to plan a beach day, host a casual BBQ, or simply enjoy a well-earned break from routine.

The festive season in Australia looks different for everyone. That’s part of what makes it so special. We live in a society full of rich cultural traditions. Some festive traditions have been passed down for generations, such as midnight Mass, lighting candles for Hanukkah, or gathering for a family meal on Christmas Day. Others have come to us through popular culture, often shaped by images of snowy winters and roaring fireplaces that don’t quite fit our sunny, southern hemisphere reality.

Think hot roast dinners in 35-degree heat, matching Christmas jumpers despite the sweat, and singing about snowmen and sleighbells.

And that’s okay. That’s part of the rich tapestry that is celebrating the festive season.

However, while tradition can be beautiful, it’s also worth asking yourself: do these traditions still bring joy to my life? Or am I doing them out of habit or obligation?

Reducing stress, reclaiming joy

The lead-up to the holidays can easily become overwhelming. This time of year often brings with it a long list of expectations about what to cook, how to decorate, where to be, and what to buy.

Trying to meet every expectation, real or imagined, can drain the joy right out of what is meant to be a time of celebration.

By letting go of pressure and embracing flexibility, we can shift the focus back to what really counts. Laughter. Connection. Rest. Reflection.

It is okay to opt out of what no longer fits. In fact, doing so often creates more space for what actually feels meaningful.

Rethinking what celebration looks like

While traditions can be a wonderful way to connect with our roots, they are not set in stone. Over time, life changes. Families grow and shift. Priorities evolve. The way we mark special moments can grow with us.

So, it is worth pausing to ask: are these traditions still adding joy to my life? Or am I continuing them out of pressure, or a sense of obligation?

Giving yourself permission to do things differently can be both freeing and fulfilling.

Making meaning in your own way

Reimagining tradition does not mean abandoning everything you love. It means choosing what feels right for you and creating space for joy, connection and rest – however that looks.

You might decide to swap the roast for prawns and salad and the pudding for a pavlova. Or ditch the mess of wrapping paper and presents in favour of shared experiences. You could even celebrate on a different day to reduce stress. Some people find joy in having a picnic in a beautiful location, taking a family beach walk at sunset, or simply spending the day unplugged from screens.

For others, creating new traditions might involve volunteering in the community or cooking dishes from their cultural heritage.

Whether your festive season is full of people or quiet moments, it only needs to reflect what matters most to you.

The season is yours to shape

There is no one way to celebrate. What is right for one person may not suit another and that is the beauty of it. The festive season does not have to look a certain way to be valid or joyful.

You might still love baking the same cake your grandmother made or singing carols in your street. Or you might find joy in starting completely new customs that reflect your values and lifestyle today. Either way, the important thing is that your celebrations feel true to you.

Small moments can become meaningful rituals too. A quiet morning coffee, a favourite song playlist, or calling someone you have not spoken to in a while are all things that can bring warmth and joy without adding stress.

Whatever this season means to you…

We hope it brings you joy.

If you’re looking for some guidance to plan your moments, our team are here to help. Contact us here today.

The post Celebrating with heart – not habit appeared first on Direct Advisers.

There are 2 ways of contributing to your spouse’s super:

• You may be able to split contributions you have already made to your own super, by rolling them over to your spouse’s super – known as a contributions-splitting super benefit.
• You can make a super contribution directly to your spouse’s super, treated as their non-concessional contribution, which may entitle you to a tax offset.

Splitting your contributions with your spouse

Some super funds allow you to split your contributions with your spouse.

When and how to apply

You can generally apply to split your contributions with your spouse after the end of the income year in which your contributions were made.

You apply to your fund to split your employer contributions and personal concessional contributions made during the previous income year, using the Superannuation contributions splitting application (NAT 15237) or similar form provided by your fund. The fund has the discretion to allow or not allow the request.

There are restrictions on the type and amount of contributions you can split.

If you’re planning to split any part of your contributions with your spouse but you also want to claim a tax deduction for them, you must give your fund the notice of intent to claim a deduction before applying to split the contributions.

How split contributions are treated and reported

A contribution split with your spouse is called a ‘contributions-splitting super benefit’ and is treated as a rollover to your spouse, not a new contribution for them.

Accordingly, splitting your contributions with your spouse does not reduce the total contributions made for you or change their characteristics for the purposes of your contributions caps. For example, if you make a personal contribution and claim a tax deduction for it, that will count towards your concessional contributions cap for the year even if you then split and roll it over to your spouse. It will not count towards your spouse’s cap.

Tax offset for super contributions on behalf of your spouse

You may be able to claim a tax offset of up to $540 per year if you make a super contribution on behalf of your spouse (married or de facto) if their income is below $40,000.

Contributions you make to your spouse’s super are treated as their non-concessional contributions, whether or not you’re eligible for the super tax offset.

General eligibility conditions

To be eligible:

• the contribution must be made to either a complying super fund or an approved retirement savings account (RSA)
• both you and your spouse must be Australian residents when the contribution is made
• the contribution is not deductible by you
• you and your spouse must not be living separately and apart on a permanent basis when making the contribution.

Specific eligibility conditions

You’re eligible for a tax offset for a contribution made on behalf of your spouse if:

• their income is less than $40,000 in the income year in which the contribution is made, calculated as the sum of their:
  • assessable income (disregarding any amount released to your spouse under the first home super saver scheme)
  • total reportable fringe benefits amounts
  • total reportable employer super contributions 
• your spouse did not exceed their non-concessional contributions cap in the income year in which the contribution is made
• your spouse had a total super balance less than the general transfer balance cap immediately before the start of the income year in which the contribution is made
• for the 2020–21 and later income years, your spouse was under 75 years old when the contributions are made
• for income years before 2020–21, your spouse was under 70 years old when the contributions were made.

Offset amount

The tax offset amount reduces when your spouse’s income is greater than $37,000 and completely phases out when your spouse’s income reaches $40,000. The tax offset is calculated as 18% of the lesser of:

• $3,000 minus the amount by which your spouse’s income exceeds $37,000
• the sum of your spouse contributions in the income year.

The tax offset for eligible spouse contributions can’t be claimed for super contributions that you made to your own fund, then split to your spouse. That is a rollover or transfer, not a contribution.

Example: eligibility for the tax offset for super contributions on behalf of your spouse

Robert and Judy are spouses. Robert earns $19,000 in 2018–19 and Judy makes a $3,500 contribution to Robert’s super fund.

Robert and Judy meet the eligibility requirements to claim a tax offset. Judy can claim a tax offset in her 2018–19 tax return for the contributions she makes to Robert’s super fund.

The tax offset is calculated as 18% of the lesser of:

• $3,000 minus the amount over $37,000 that Robert earned (in this case, nil)
• the value of the spouse contributions (in this case, $3,500).

Judy can claim a tax offset of $540, being 18% of $3,000.

Example: eligibility for a part tax offset for super contributions on behalf of your spouse

Carmel and Adam are married and living together. Carmel is 46 years old and her income is $38,000 per year. Carmel has not exceeded her non-concessional contributions cap for the income year, and her total super balance is under $1.6 million.

Adam wishes to make a super contribution of $3,000, on Carmel’s behalf, to her complying super fund.

Carmel’s income is under the threshold. Adam is eligible for a tax offset. As Carmel earns more than $37,000 per year, Adam will not receive the maximum tax offset of $540. Instead, his entitlement is 18% of the lesser of:

• $3,000 reduced by every dollar over $37,000 that Carmel earns
• the value of spouse contributions.

Carmel earns $1,000 over the $37,000 income threshold. Adam’s tax offset is $360. This is calculated as 18% of $2,000 ($3,000 reduced by the $1,000 that Carmel earned over the $37,000 income threshold).

If you have any questions on how you can implement this into your superannuation plan, contact our team here.

Source: ato.gov.au
Reproduced with the permission of the Australian Tax Office. This article was originally published onhttps://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/how-to-save-more-in-your-super/spouse-super-contributions
Important:
This provides general information and hasn’t taken your circumstances into account.  It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, we do not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, we do not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person. 
Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business nor our Licensee takes any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) accessible from this page.

The post Spouse super contributions appeared first on Direct Advisers.

Estate planning involves developing a strategy to deal with your assets after you die – the legal instruments and structures, such as a will, you put in place to transfer your assets in the event of death.

Tax is a major consideration in estate planning, and strong governance relating to the tax aspects of estate administration can help manage the risks.

Ensure you or your staff have sufficient knowledge and skills to meet your responsibilities. Be prepared to seek assistance from external advisers on more complex tax issues.

Developing an effective strategy

Estate planning may be considered as part of your overall succession plan for your business. You may need to seek specialist advice on the most appropriate estate planning strategy.

Have a process in place to periodically review your strategy in conjunction with your advisers, including your legal, tax, superannuation and financial advisers.

Beware of schemes that claim to have estate planning purposes but are merely tax avoidance arrangements. An effective tax governance framework includes processes for evaluating various arrangements and the tax risks involved.

Preparing a valid will

If someone dies without a valid will, this is called ‘dying intestate’, and their assets are distributed according to the inheritance laws of the states and territories of Australia. In this case there is a risk that the undocumented intentions of the deceased person in relation to their estate may not be fully acted on.

Depending on the marginal tax rates of different beneficiaries, intestacy could potentially lead to an overall imbalance in the distribution of an estate due to higher rates of tax payable by some beneficiaries.

Planning ahead can avoid this result. When preparing a will, the will maker and their advisers can assess opportunities to manage the tax implications for beneficiaries.

Administering a deceased estate

As executor of a deceased estate, you need to understand your tax obligations, including:

• notifying us that you’ve been appointed as executor
• lodging a final return, and any outstanding prior-year returns, for the deceased person
• lodging any trust tax returns for the deceased estate
• providing beneficiaries with the information they need to include distributions in their own returns and, in certain cases, paying tax on their behalf
• paying tax on the income of the deceased estate.

Testamentary trusts

A testamentary trust is a trust established under a valid will, but it’s not the same trust as the deceased estate. A testamentary trust functions in a similar way to a discretionary family trust, with certain provisions of the will operating like a trust deed.

Like any trust, a trustee of a well-governed testamentary trust will:

• properly understand the tax profile of potential beneficiaries in the light of intended tax outcomes
• lodge a tax return for every financial year that it is in existence
• maintain proper trust account records (such as trustee resolutions, detailed financial statements and reconciliations), especially where a trustee is streaming capital gains or franked dividends
• fully document capital gains tax events, cost bases, and rollovers and other concessions claimed.

Depending on who is appointed as the trustee and appointor of the testamentary trust, there may need to be a high level of co-operation between family members to ensure that necessary tax, financial and other information is shared for the trust to operate effectively.

A well governed testamentary trust will ensure that tax outcomes are achieved and, more importantly, complex family or legal disputes can be prevented.

Capital gains tax

Special capital gains tax (CGT) rules apply to the transfer of any CGT assets from a deceased estate. You should seek specialist advice in relation to the CGT implications of passing on or disposing of the assets of a deceased estate.

Keep complete records of CGT assets. These will be needed by the executor and any beneficiary who receives a CGT asset from the estate.

Superannuation and death benefits

Ensure you understand the tax issues around estate planning and superannuation.

For example, the tax impact of distributions made under a binding death nomination is usually one of the major considerations in estate planning.

Assets held by a person in their superannuation fund are not automatically included in their estate. In the absence of a binding death benefit nomination, the trustee has the discretion to pay the benefits of the deceased to any of their superannuation dependents instead of the estate (rather than according to the will, which only deals with the estate assets), and of deferring tax consequences. Where a nomination is in place, the benefits will be paid to the nominated beneficiaries.

It’s good practice to regularly review the need for any nominations to ensure your superannuation benefits will be passed on to your nominated beneficiaries, and that the nominations are valid and effective. Seek advice on the tax implications.

Example: Reviewing your strategy as circumstances change

As part of your estate planning strategy, you make a binding death nomination to provide for your under-age children who would receive the benefit tax free. You get advice to ensure that the nomination is valid and effective.

You provide for your older children, who would be taxed on receipt of superannuation death benefits, in your will.

After some years, when all of your children are older, you review your strategy and make a new nomination that better suits your family’s tax situation.

Because your personal circumstances change from time to time, it’s important that you regularly review the estate planning and income tax consequences when it comes to the distribution of your superannuation assets to your beneficiaries. Areas that warrant attention include:

• the distinction between a ‘superannuation dependent’ and a ‘tax dependent’
• interaction with testamentary trusts
• effecting the reversion of a pension to spouse
• realising fund assets for payment to beneficiaries

Our team is here and ready to help you plan your estate. Contact us here.

Source: ato.gov.au
Reproduced with the permission of the Australian Tax Office. This article was originally published on https://www.ato.gov.au/newsroom/smallbusiness/ . Important: This provides general information and hasn’t taken your circumstances into account.  It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, we do not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, we do not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person. 
Any information provided by the author detailed above is separate and external to our business and our Licensee. Neither our business nor our Licensee takes any responsibility for any action or any service provided by the author. Any links have been provided with permission for information purposes only and will take you to external websites, which are not connected to our company in any way. Note: Our company does not endorse and is not responsible for the accuracy of the contents/information contained within the linked site(s) accessible from this page.

The post Estate Planning appeared first on Direct Advisers.

With more care levels, clearer pricing, and greater control over how your funding is used, the new system aims to better match services to individual needs. Providers will be required to offer detailed cost breakdowns, empowering you to make informed decisions about your care.

While the reforms are a step forward in care quality, they also come with changes in how services are funded and that may mean higher out-of-pocket costs for some.

What you pay depends on your financial situation – whether you receive a full or part pension or are self-funded – and the services you access.

As the aged care landscape evolves, staying informed is key to making confident choices. Whether you’re planning for yourself or supporting a loved one, understanding the new system will help you access the right care at the right time. 

Help at home

From 1 November the current Home Care Packages will be replaced by a new program called Support at Home.

The key changes include:

• Eight levels of care (up from four) to better match individual needs
• Extra funding for assistive technology, home modifications and palliative care

Services are expected to remain the same but the way you pay for them may change.

• For example, clinical care (such as nursing or physiotherapy) will be fully funded by the Government.
• You may pay more for everyday living services (such as meal preparation or cleaning) than you do for independence supports (like personal care or transport).
• The out-of-pocket costs for everyday living will range from 17.5 per cent for full pensioners to 80 per cent for self-funded retirees.
• Non-clinical support, like showering, will cost five per cent for full pensioners to 50 per cent for self-funded retirees.

If you were approved for a Home Care Package on or before 12 September 2024, you will be eligible for fee concessions to ensure you are not worse off under the new rules.

The package level you are assigned sets the total funding available to pay for care, with 10 per cent allocated to the care provider to cover the cost of care management.

You then work with your provider to decide how you want to spend the rest of the budget. The provider will set their fees for services and you will make a contribution based on your income.

Residential aged care

Room prices in aged care facilities have been steadily rising following an increase in the Refundable Accommodation Deposit (RAD) threshold from $550,000 to $750,000.

Higher RADs mean you may need to use more of your savings or income to cover aged care costs.

From 1 November 2025, anyone who moves into care after this date and pays a RAD, will have two per cent of that amount deducted each year, for up to five years.

You can still opt to pay a Daily Accommodation Payment (DAP), but this will increase every six months in line with inflation.

Other fees include:

• the basic daily fee (set at 85 per cent of the single age pension)
• a means-tested fee or non-clinical care contribution
• potentially a higher everyday living fee (previously known as extra or additional services)

Fee caps and planning ahead

The lifetime cap on aged care contributions continues. You won’t pay more than $130,000 (indexed) over your lifetime towards home care and residential care combined.

Understanding how the changes affect your financial future is vital. You’ll need to consider:

• whether someone will remain in the family home
• your current income and assets
• potential age pension entitlements
• estate planning strategies

Use the government’s fee estimator at MyAgedCare to get a clearer picture of your potential costs.

Get advice early

Navigating aged care can be complex and the upcoming changes add new layers of decision-making.

We can help explain your options, structure your assets, minimise fees and plan for your future care needs.

If you would like to discuss your aged care options, contact our team here.

The post New aged care act: what you need to know appeared first on Direct Advisers.

On the positive side, there will be more packages available, which should reduce waiting times. But there will also be changes to the contributions (fees) you pay – and for some people, this could mean paying more for the care services you access. 

Here’s a simple overview to help you understand what’s changing and how you can prepare. 

What’s changing? 

The existing Home Care Packages will cease on 1 November 2025, and everyone will transition to Support at Home. You might not see a disruption in your services, but you will notice changes.  

Some key differences in the new system: 

• A new fee structure, based on your financial circumstances and the services you access 

• You will continue to be charged by your provider, but only after you have received services 

• Eight levels of care instead of four, to better match your needs, with additional funding for assistive technology and home modifications (where approved) 

• Budgets will be allocated quarterly – and if not used, won’t carry over. 

These changes apply to both new applicants and people who are already receiving care.  

What about fees? 

The Government will continue to subsidise care costs within your approved budget, but you’ll be expected to make a contribution. Here’s how the new contributions will work: 

• What you pay depends on your financial situation – whether you receive a full or part pension, or are self-funded 

• Clinical care (like nursing or physiotherapy) will be fully funded by the Government 

• You may pay more for everyday living services (like meal preparation or cleaning) than you do for independence supports (like personal care or transport). 

• If you were approved for, or receiving, a Home Care Package as at 12 September 2024, you will be eligible for fee concessions, so you are no worse off under the new rules. 

Importantly, there’s a lifetime cap on your contributions – you will not pay more than $130,000 (indexed) over your lifetime. 

Your package level sets the total funding available to pay for care, but 10% is allocated to the care provider to cover the cost of care management. You then work with your provider to decide how you want to spend the rest of the budget. The provider sets their fee for services so it’s worth checking what they charge – the more they charge, the less support you may be able to afford from your package. You could always choose to pay extra if your package does not cover all the care you need. 

How to be ready? 

To make the most of the new system, it’s a good idea to take a few steps before November: 

• Think about your care needs – what help do you need and what services will make a difference to you? 

• Talk to your current provider – if you’re already receiving care, they should be in touch to help you transition. You’ll need to sign a new service agreement under the new system. 

• Book an assessment – if you need help but don’t already have a package, contact My Aged Care to arrange a care needs assessment. This takes time, so it’s best not to delay. 

Need help to understand your options? 

Navigating aged care can be complicated – especially with these new changes. That’s why we offer specialist aged care advice to help you plan and make the best choices. 

We can help you: 

• Understand how the changes affect you 

• Calculate estimates of your contributions 

• Make sure your finances and investments are set up to provide the cashflow you’ll need. 

If you’d like to chat about your options or get help preparing for the changes, we’re here to help. Just give us a call. 

IMPORTANT INFORMATION: 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 has been prepared without consideration of your individual objectives, financial situation or needs. Before making any decisions, you should consider the appropriateness for your personal investment objectives, financial situation or individual needs. We recommend you see a financial adviser, registered tax agent or legal adviser before making any decisions based on this information. Current at 8 July 2025. 

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It’s a number that’s predicted to grow more rapidly over the coming 20 years to $5.4 trillion, the report finds. 

Managing this flow of wealth to family groups, often complicated by divorce and remarriage as well as children from previous marriages, can lead to disputes and legal challenges if not carefully handled. 

Legal firms agree that the number of challenges to wills has been increasing each year with adult children most likely to take action. One firm estimates more than 60 per cent of claims are brought by adult children and around 20 per cent by partners or ex-partners.ⁱⁱ 

Yet, many still do not have wills. 

In the latest research available, the Australian Law Reform Commission found that almost 40 per cent of adult Australians did not have a will although, this figure declined to 7 per cent for those older over 70.ⁱⁱⁱ 

If you die intestate in Australia, your estate is distributed according to state and territory laws, and the laws vary slightly between each state and territory. Generally, the estate goes to the next of kin starting with the surviving spouse or partner followed by children, parents, siblings and then other relatives. If no relatives can be found, the estate may go to the government. 

So, if it is important to you to have a say in how your assets will be distributed, a will is a must. 

Meanwhile, for those in a new partnership but have children from a previous marriage, a binding financial agreement can be a useful way of protecting your partner’s interests if something happens to you. 

It’s a legally enforceable contract that details how assets, liabilities and responsibilities will be divided if you separate, divorce or one partner dies. 

Designing your transfer of wealth 

Distributing your wealth now or later can depend on the family dynamics, any businesses you may own and whether you have a passion for creating a legacy – donating to a charity, for example. Alternatively, you may prefer to spend it on yourself and your partner to enjoy your later years. 

The housing crisis and the emergence of the ‘bank of mum and dad’ has increasingly seen wealth transfer happening while the benefactor is still alive. You may wish to help your children or grandchildren to get a foot onto the property ladder, contribute to their superannuation, or pay their school fees or student loans. But it’s crucial to obtain professional advice to understand any consequences of giving lump sums, particularly those receiving government entitlements, as they could potentially be impacted.  

Another alternative is testamentary trust. This is commonly used to provide financial security for beneficiaries, such as family members or loved ones. It is used to manage and distribute assets according to specific instructions laid out in the will. 

It can be specifically written and incorporated in your will and takes effect when you pass away. It is administered by a trustee, who you would also name in your will. The trustee would take legal control over the trust assets and is responsible for the management and distribution of the assets to the beneficiaries, based on the instructions in the trust. 

This strategy could also potentially minimise any tax liabilities. However, there are a lot of things you need to consider when deciding whether or not a testamentary trust is right for you. 

Some might prefer to establish or contribute to a charitable foundation as a way of building a family legacy. It’s a move that allows you to have some say over how your hard-earned wealth is distributed and could involve family members to allow them to build knowledge and experience in philanthropy. 

Most importantly, creating a family legacy relies primarily on the strength of family relationships. Any disputes will more than likely be magnified after a death and some relationships may be strained, so it may be helpful to discuss your intentions with family members and any other beneficiaries. Be clear about your plans and don’t ignore negative reactions. 

Getting your affairs in order 

After all, wealth transfer isn’t just about finances – it’s about securing family harmony and ensuring your legacy is preserved according to your wishes. Taking the time to plan, communicate openly with loved ones, and seek professional guidance can make all the difference. 

To ensure a smooth transfer of your wealth and put the right plan in place for you, contact our team here. 

i Bequest Report | JBWere 

ii The numbers don’t lie | Solomon Hollet Lawyers 

iii Wills | ALRC 

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Estate plans

An estate plan records what you want done with your assets after your death. It can include documents such as:

• your will
• a testamentary trust (as part of your will)
• superannuation binding nominations

It also covers how you want to be cared for — medically and financially — if you can no longer make your own decisions. This part of your estate plan may be in documents such as:

• any powers of attorney
• a power of guardianship (giving someone the right to choose where you live and to make decisions about your medical care)
• an advance healthcare directive (your needs, values and preferences for your future care)

The documents you choose will depend on your situation and what you’re comfortable to trust others with. Get legal advice if you’re not sure.

You must be over 18 and mentally competent when you draw up your estate plan.

Your will

A will is a legal document stating what you want to happen to your assets when you die. It is part (but not all) of your estate plan.

Everyone over the age of 18 should have a will.  

Your will can cover things like:

• how you want your assets shared
• who will look after your children if they’re still young
• any trusts you want to set up
• how much money you’d like to give to charities
• plans for your funeral

Smart Tip: It’s important to have an up to date will. If you die without one, the law decides who will get your assets — and this may not be who you wanted.

Making your will

You can get your will written by a solicitor (for a fee) or by a Public Trustee.

A Public Trustee may not charge if you:

• are a pensioner or aged over 60, or
• nominate them to carry out the instructions in your will (that is, to be your executor)

The rules vary, so visit the Public Trustee office website for your state.

• Australian Capital Territory public trustee and guardian
• New South Wales trustee and guardian
• Northern Territory public trustee
• Queensland public trustee
• South Australia public trustee
• Tasmania public trustee
• Victoria state trustee
• Western Australia public trustee

Here are some low-cost alternatives to Public Trustees:

• Community wills days: The Salvation Army offers low-cost simple will preparation, provided by local solicitors as a community service. To join the waiting list for the next event in your state, see community wills days on the Salvos website.
• Will kits: CHOICE has a helpful article about will kits, DIY will kit review. They look at the pros and cons of four will kits, free or low-cost. They also give tips on drafting your will, and when to consider getting more legal advice.

If you use an online will kit, get it checked by a solicitor or Public Trustee. They can make sure it’s been done properly. If your will isn’t done properly, it will be invalid.

Make sure you put your will in a safe place and tell someone close to you where it is.

Updating your will

It’s important to update your will as your situation changes — for example, if you:

• get married
• divorce or separate
• have children or grandchildren
• have a significant financial change
• lose your spouse (or someone else who is named in your will) through death

Super and your will

A binding nomination directs who your super fund trustee gives your super benefit to when you die. If you don’t nominate someone, the super fund trustee will decide who your money goes to.

Family trusts and your will

If you have a family trust, it continues after your death. The trust determines who gets your assets, even if your will says something different.

Testamentary trusts

A testamentary trust is a trust that is written in your will. It takes effect when you die, and it’s administered by a trustee, who you usually name in your will.

The trustee looks after your assets until your beneficiaries can get them. This is set out in your will, and is either when:

• a child reaches a certain age, or
• a beneficiary achieves a specific goal (for example, they get married or earn a particular qualification)

You may want to consider setting up a trust if your beneficiaries:

• are minors (under 18), or
• have diminished mental capacity, or
• may not use their inheritance well

Another reason to consider a trust is to avoid family assets being:

• split as part of a divorce settlement, or
• part of bankruptcy proceedings

Powers of attorney

A power of attorney is a document where you give someone else the legal right to look after your affairs for you. It’s important to nominate someone that is trustworthy, financially responsible, and likely to be around when you need them.

Each state and territory have different rules for setting up a power of attorney. 

There are different types of powers of attorney:

General power of attorney

This allows someone to make financial and legal decisions for you. It’s usually for a specified time — for example, if you’re overseas and can’t manage your affairs at home.

If you become unable to make decisions yourself, a general power of attorney becomes invalid.

Enduring power of attorney

An enduring power of attorney (or EPA) allows someone to make financial and legal decisions for you. If you become unable to make decisions yourself, an enduring power of attorney will still be valid.

Medical power of attorney

This allows someone to make medical decisions for you if you ever become unable to do so yourself. It doesn’t allow them to make other kinds of decisions.

Legal and financial housekeeping

It will help your family and your executor if you list all the documents you have and where they’re kept.

As well as the documents talked about above, other key documents to keep handy are:

• birth certificate
• marriage certificate
• life insurance
• medical insurance
• Medicare card
• pensioner concession card
• house deeds
• home and contents insurance
• deeds and insurance policies for any other real estate you own
• bank account details
• superannuation papers
• investment documents (securities, share certificates, bonds)
• prepaid funeral plans

For help and advice, contact our team here.

Reproduced with the permission of ASIC’s MoneySmart Team. This article was originally published at https://moneysmart.gov.au/living-in-retirement/wills-and-powers-of-attorney
Important note: This provides general information and hasn’t taken your circumstances into account.  It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, we do not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, we do not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.  Past performance is not a reliable guide to future returns.
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