The Australian aged care sector is changing in July. To understand the changes and subsequent impacts, we asked the Wealth Creation team at MB+M what families considering aged care should consider.

Navigating aged care is never easy, and with major aged care reforms in Australia coming in July 2025, families must prepare for the financial and emotional impacts. Understanding changes to aged care costs, Refundable Accommodation Deposits (RADs), and room pricing is essential for making informed decisions. 

At MB+M, our aged care financial planning specialists are here to help you understand how these changes affect you and your loved ones. 

What are the key changes to aged care?

The upcoming reforms focus on improving aged care affordability and quality. Here’s what you need to know: 

1. Aged care room price cap 

A new pricing structure will introduce a cap on aged care room costs. While this is intended to bring more fairness and clarity and protect residents from excessive fees, it also means families must carefully plan and consider their options to avoid any budget difficulties. 

2. 10% retention on refundable accommodation deposits (RADs) 

If a RAD is held for over five years, a 10% retention will now apply. This could significantly impact estate planning and the financial legacy you leave behind. Knowing how to navigate this change and make informed decisions about care and costs is essential in early aged care financial planning. 

3. More transparency and personalised care plans 

Reforms will place greater emphasis on individualised care plans, ensuring older Australians receive the support they need. However, these changes require expert guidance to ensure the best possible care without unexpected expenses.

Why should I prepare now?

Aged care decisions often happen suddenly due to health crises, leaving families scrambling for options. The financial and emotional strain of aged care decisions can be overwhelming if left until the last minute. With these reforms just months away, now is the time to prepare.

By understanding your financial position and government support options, you can make confident, informed decisions that ensure the best possible care for your loved ones. With the aged care room price cap and RAD retention policy in place, getting expert advice early can help families avoid costly mistakes.

How the team of financial advisors working under OzPlan Financial Services at MB+M can help with aged care planning

Our team of Accredited Aged Care Professionals can help families: 

• Understand aged care costs
• Navigate government subsidies for aged care 
• Prepare for the 10% RAD retention rule and its impact on long-term finances. 
• Navigate options within the new pricing cap 
• Explore strategies to protect financial security 

What are the next steps?

Aged care is about more than just finances—it’s about ensuring dignity and quality of life for those you love. The reforms coming in July are significant, but with the right advice, you can navigate them with confidence. Contact MB+M today to start planning for a secure and supportive future.

MB+M is proud to have some team members who are Accredited Aged Care Professionals. This ensures you receive the best possible advice from a financial advisor who knows the process, system, and facilities whilst keeping your best interest top of mind.

Book an appointment with one of our team today to discuss your options of entering residential aged care. If you’re interested in booking an appointment, your first consultation is free, call us on 03 5831 1233.

Read more of our articles about aged care and retirement here: Are you ready for Aged Care, Australian guide to concession cards, How do I fund the later years of retirement?

You can find out more information about aged care in Australia at My Aged Care.

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Published March 2025

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