Patty Kikos interviews Paul Murphy who went from being an accountant and financial planner, to an advocate for helping people put their loved ones into Aged Care facilities. Knowing the numbers, the forms, the placement process from BOTH a family perspective and a care provider’s angle, as well as understanding the government requirements gives him a unique perspective that very few people have. GUEST: Paul Murphy - https://bedsearch.com.au/ SOCIAL MEDIA: Follow Patty on Instagram Follow The Benevolent Society on Instagram Follow Carer Gateway on Facebook Follow The Benevolent Society on Facebook CREDITS: Host – Patty Kikos Producers – Patty Kikos and John Hresc Sound Engineer – John Hresc GET IN TOUCH: Carer Gateway is proud to offer emotional and practical services and support for carers with the aim of making your life easier. You can call us on 1800 422 737 to find out more about peer support groups, counselling, coaching, online skills courses, tailored support packages, emergency respite, other government supports, as well as tips and information, or visit our online home at www.carergateway.gov.au Got some questions or thoughts for Patty or the team? Email us at cgconnections@benevolent.org.au and put ‘Attention Patty’ in the subject line. ACKNOWLEDGEMENTS: The Benevolent Society acknowledges the Traditional Owners of the Land we have recorded this podcast on, the Gadigal people of the Eora Nation. We pay our respects to their Elders past and present and extend that respect to all Aboriginal and Torres Strait Islander cultures.
Patty Kikos interviews Paul Murphy who went from being an accountant and financial planner, to an advocate for helping people put their loved ones into Aged Care facilities. Knowing the numbers, the forms, the placement process from BOTH a family perspective and a care provider’s angle, as well as understanding the government requirements gives him a unique perspective that very few people have.
GUEST:
Paul Murphy - https://bedsearch.com.au/
SOCIAL MEDIA:
Follow Patty on Instagram
Follow The Benevolent Society on Instagram
Follow Carer Gateway on Facebook
Follow The Benevolent Society on Facebook
CREDITS:
Host – Patty Kikos
Producers – Patty Kikos and John Hresc
Sound Engineer – John Hresc
GET IN TOUCH:
Carer Gateway is proud to offer emotional and practical services and support for carers with the aim of making your life easier.
You can call us on 1800 422 737 to find out more about peer support groups, counselling, coaching, online skills courses, tailored support packages, emergency respite, other government supports, as well as tips and information, or visit our online home at www.carergateway.gov.au
Got some questions or thoughts for Patty or the team? Email us at cgconnections@benevolent.org.au and put ‘Attention Patty’ in the subject line.
ACKNOWLEDGEMENTS:
The Benevolent Society acknowledges the Traditional Owners of the Land we have recorded this podcast on, the Gadigal people of the Eora Nation. We pay our respects to their Elders past and present and extend that respect to all Aboriginal and Torres Strait Islander cultures.
Paul
Yeah. So, one of the biggest issues we see in this space is people have automatically sold the house because mum’s going into care, and she lives on her own and she's going into care. They sell the house, and they pay off the room rate, but they can lose their pension because if you sell a million dollar house and pay a $500,000 room rate, you now have $500,000 in the bank, so you don't qualify for a pension anymore.
So again, making those financial knee jerk decisions, if you like, without an advisor to explain, you may decide that that's the best option anyway, but it's best to get all the financial information before you make the decisions.
Patty
So, this means that her pension could decrease and her monthly fee could increase at her living centre?
Paul
Absolutely. Yep.
Patty
And then would there be any other examples that are relevant here?
Paul
So, for example, I've seen cases where mum's going to care, but the the daughter has looked after mum for however many years and in her will she has the house going to the daughter and all the other assets getting split among all the other siblings.
But, if you sell the house, the daughter doesn't get it. So, there's always, I call them tentacles or threads attached to any of these decisions. Things that you pull that make the decision on one level, could tend to call into something else that you don't understand.
--
Billy:
From the Carer Gateway at the Benevolent Society, we welcome you to, Carer Conversations with your host Patty Kikos.
The Care Gateway is the Australian Government national care hub and provides reliable services, support and advice especially for carers.
This podcast is where we share interviews with guests that have specialized knowledge to help support carers to look after their emotional, mental and physical well-being.
We are recording on Aboriginal country, on lands which were never ceded. We acknowledge the traditional custodians and cultural knowledge holders of these lands and waters. We pay our respects to Aboriginal elders, past and present.
Always was, always will be.
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Patty
Welcome to our beloved Carer Conversations podcast.
We are so glad that you’ve chosen to be part of this chat, because it’s one that I’m sharing by popular demand from many carers who feel stressed at the thought of putting their loved one into aged care.
This is such a big area to cover that we have decided to devote 2 individual episodes to this topic, and we will have a separate interview about the financial questions you might have, even though we will touch on this briefly with Paul Murphy who is my guest today.
Paul tells me that he has always been good with numbers, that is why things like accounting, spreadsheets and financial planning were always interesting to him. But numbers alone cannot make something stimulating for too long, so he moved into the world of aged care.
Initially this was to help clients, but Paul has also now morphed into assisting others, as well as the aged care homes themselves, to explain the process of going into care.
Knowing the numbers, the forms, the placement process from BOTH A FAMILY PERSPECTIVE and a care provider’s angle, as well as KNOWING the government requirements gives him a unique perspective that very few people have.
Paul aims to get the best outcome in the easiest manner, this is why he developed a database called BedSearch, which helps hospitals and agencies like the Carer Gateway quickly find vacancies in residential homes. Paul – hello!
Paul
Hello. It's good to be here. Thank you.
Patty
A big thank you for flying down to Sydney from the sunny Gold Coast to recording person with us today and I must apologise for the rain. Sydney should be on her best behaviour and showing off, but alas, she's not.
Paul
It’s great to be here.
Patty
It's good to have you tell us. Where were you born?
Paul
I was born in Ireland, immigrated here in 1979 as an 11 year old with my family and left for 6months in Coogee in an immigrant hostel, and then moved to Qld.
Patty
I'm slightly disappointed in you because you lost your lovely Irish accent, but I feel like I don't have a right to hold that against you.
Paul
That's alright. My wife still has hers, so maybe you 2 can meet. SHE IS CONSTANTLY DISAPOINTED IN THINGS ABOUT ME AS WELL. 😊
She's in Ireland at the moment and is looking after her mother. She's starting that whole care journey at the moment that we’re going to talk about.
Patty
Indeed. Do you offer advice?
Paul
Only when asked.
Patty
Yeah, explain that a little bit.
Paul
I'm available for any questions and queries they may have, but because it's my wife and her family, I'll let them work through what they need to work through and then when she wants some help she can ask me.
Patty
That's fair enough. That's very disciplined of you. I know you're the eldest of four and you've got three younger sisters. Are you navigating something similar with your family?
Paul
Mum and Dad are fine. They're in the late 70s. Dads 80 next year, but things are starting to happen, so we're probably a few years away from working through things like that.
Patty
So you're just aware of changes and having conversations with your siblings?
Paul
Yeah. Yeah.
Patty
You say you always loved maths and science at school. Did you always want to be an accountant?
Paul
No, I never wanted to be an accountant. I wanted to join the Air Force as a pilot. But back then, when I went for my test, they told me I needed glasses, and therefore couldn't be a pilot
Patty
You would have rocked a pair of aviators though. Now I have it on good authority that you are a football fanatic and a baseball super fan. When you say football, can you clarify? Do you mean soccer or rugby?
Paul
The one they play with the foot - soccer.
Patty
Excellent. This is why you fit in so well in Australia now. You went from being an accountant to a financial planner. Your world is now aged care. Did you finally see the light and admit that numbers are a wee bit boring?
Paul
Yes, very boring, but I also I found dealing with the numbers was sort of dealing with things after the event after things had happened. In financial planning, we're preparing for things that might happen in 10 years, whereas the Aged Care world was dealing with people right in the middle of something going on. And I found that far more rewarding.
Patty
Yeah, I bet! You work from home on a scale of 1 to 10. How disciplined are you?
Paul
Probably an 8. I don't mind working at home. You've just gotta set aside your time to do it. But I do need to go to a coffee shop 2 or 3 times a week just to hear the noise.
Patty
Hmm, you've gotta turn off sometimes. And it sounds like you're good at that. I know that you've got an office, so the physical act of closing the door, is like a boundary. And also, that's where your son Andrew goes on the Xbox.
Paul
Indeed. Yeah. So, you close the door and it's turned off time and then and then that's sort of forced on me because I can't go back in there for most of the weekend. And I got used to that dealing with that.
I got a masters at sort of 32 or 33 and had a newborn at the time. So, I sort of taught myself to switch on for when I needed to and switch off when I needed to, so that helped.
Patty
That's very disciplined of you, Paul. You share that there are 3 steps to take before moving into aged care. However, there's also the pre planning that needs to occur first regarding some informal tasks and some tasks that are more formal.
Let's start with the formal things that we need to check off our list first, what do we need to ensure that we have before anything else?
Paul
Yeah. So, there's a couple of things. First, it’s the legal stuff whilst somebody's available and able to do all the legal stuff, my advice is to get that done, so things like Wills, Powers of Attorney, medical preferences.
Patty
When you say medical preferences, what do you mean?
Paul
So, things like DNR or “do not resuscitate”, so hard decisions that need to be made. But you can make them while somebody's aware and available to make those decisions. And it's a lot easier to make it with those people.
Patty
OK, what else?
Paul
So, then you've got some clinical things.
Patty
So, before you go into an aged care home, you need to get what?
Paul
Well, it's called various things, but it's an aged care assessment team report. So ACAT is the short term. And that's when somebody comes out and assesses you and makes sure that you're qualified if you like to go into aged care, whether that's permanent or respite or even home care. So you need to get that done.
Patty
When you say home care, that's people coming into the home and offering care?
Paul
Yes. Care coming to the home. So again, for funding purposes to get that supported, if you like, you need to have that assessment.
Patty
Yeah. To assess how much support you need, whether it's going to be in the home or in a residential home, yeah. So you want to do that before there's been an emergency situation like a fall?
Paul
That's right, exactly. And if you have had an issue where somebody's had a fall and they're in hospital, sometimes the hospital will seek to discharge you and then get your ACAT report done. My advice is to get it done in the hospital because it's a LOT quicker.
Patty
That's good advice. What else can you share for our listeners that need to get this done but don't know who to use? I mean, they don't know any solicitors. They wouldn't know where to go.
Paul
Yeah. I just ask around, I mean. Generally speaking, I call it the ‘Yellow Volkswagen issue’.
Patty
What does that mean?
Paul
You = never see a yellow Volkswagen until you have one, and then you're driving around and you start spotting them everywhere.
Patty
You know what? For me it was a red Volkswagen and that's what I drive now.
Paul
Yep. So, once you start putting the word out there that you're looking at starting this journey with family. Generally speaking, somebody will say, "Actually I did that a year ago or 2 years ago, and here's the people. I use, they're fantastic.”
Patty
That's a good thing. Let's discuss the informal aspect of the preplanning, which is just as important. Where do you or your loved one want to go? I mean, how do we do this?
Paul
Yeah. So, my advice there is to get people engaged. It's a hard conversation to have with a parent or with a sibling or with a partner who you feel is starting out on that journey to start to get them engaged but go to open days at homes that are near you.
Generally speaking, they'll ask. They'll put aside time to say there's an open day. They call them on phone them and do tours. My advice is when you're dealing with somebody who doesn't want to get involved, is to say to them “We're going to be doing this journey with or without you, so if you want to be involved, we'd love to do these things with you. If you don't want to be involved, well then, we’ll do them anyway”.
Patty
And sometimes it's just a matter of knowing that you're going to be playing the long game. It's chess. It's not checkers necessarily, this is a part that can feel stressful and overwhelming for many people.
Paul
It is.
Patty
And it's important that you give yourself enough time to visit different centres. Be sure to space it out so that you still have time to do things afterwards that fill your cup. So, for example, if you're seeing 2 places on a Saturday, try to see them both and then have a nice brunch or a walk afterwards so that you can process your thoughts and emotions.
And remember, sometimes you're playing a long game, sometimes this is a process that can take 3 months and sometimes it can take 3 years. The mistake I see a lot of people make is that they think it will only take a few minutes to fill out some forms, but it's not like a work decision that can be made intellectually. It's an emotional decision because there are so many important parts to take into consideration to ensure that your loved one is going to be safe and comfortable and happy.
Paul
Yes, it is. And my first step, whenever you're starting on a journey like this, especially stuff that's unknown, is just to sit and have a cup of tea or coffee or whatever it is that floats your boat. But prepare. There's lots you don't know. Lots of decisions to be made, but do it one step at a time.
Patty
Yeah. And don't be afraid of making a mistake. So, if you choose something that you don't like and you think, oh, that didn't work out. It's OK.
Now you know to do something different next time. Is it important to consider what type of home you want?
Paul
Yeah. And that's why getting engaged early is a good thing. Go and see different types of homes. Some homes have religious support available, so Catholic Care or Anglicare, some have community vibe and older style homes.
Some are single and shared rooms, some have cultural and religious supports. As I've said before it it's up to touring and getting a feel for the right place and that way, you'll settle on what type of home is important.
Patty
I would be imagine that there'd be a sense of camaraderie for people to be connected to their own culture and religion, especially if this is a value that's important to them. Are there any pros and cons when it comes to choosing a religious home?
Paul
As with all of this, there's no rights and wrongs with it. It's just what feels right. You've got to trust your instincts. You may not be religious, but your mum and dad might be, and might want that regular religious support framework, and also many of the homes that have a religious support or cultural support don't allow certain things.
Patty
Like what?
Paul
So, for example, DNR do not some resuscitate, or some religious homes don't allow that or have problems with that, and you just need to find out if you're looking at homes like that, whether that's going to be acceptable to everyody.
Patty
And then there's also the other facet of not all siblings will necessarily agree.
Paul
Yeah, families generally don't agree on a lot of things.
Patty
Loaded question, answer it how you like. When is the right time to do this?
Paul
Probably best to say the wrong time is when someone's already had a fall and they're in hospital, because now you're frantically looking for a bed and getting pressure from the hospital to do so.
Patty
Yeah. So, you don't have that time.
Paul
Yes, that's right, that's the wrong time. So, the right time is anytime other than that.
Patty
What do you say to parents or partners who don't think it's the right time to plan, even though you're preempting it and you can see it.
Paul
Yeah, it's the the the unfortunate part is you can't predict when this is going to be needed. So, my advice again, when you're dealing with somebody who's reluctant to have the discussion is saying, “we're not actually going to do this right now. We're just choosing a time.”
It's like downsizing from a house to a unit. You just want to start to scale around and see what’s available and find out from them whether they want to be near the kids, or not near the kids, near grandkids, near church groups, near support groups, whatever that is.
Patty
But you just make it a casual conversation of, like in future, what would you like?
Paul
Yes. Exactly
Patty
And so maybe they think their future is going to be in 10 years, but maybe it will be 2 years, but you still have that conversation. Great analogy. OK. So stage 1, it's important to give your loved one the option of being involved in the process - or not, but the progression is still going to need to happen, so it would be nicer to do it in a collaborative manner. Tell us what's involved in step 1, in terms of finding the right place.
Paul
So, the issue a lot of people have is where, where do we look? How do we how do we start to find them? Carer Gateway is a good resource for that. They'll be aware of all the homes in an area.
Semi related to that as well as you can actually look at respite options. So, if you have your ACAT and you have respite as a priority, on that you can actually have respite options for 10-20 days up to 63 days a year where you can try different homes for a week, 10 days at a time and just get a feel for them.
Patty
It's a great stepping stone. It's a nice segue into I think it's too much for me to choose a permanent home. How about I trial it?
Can you actually visit a few centres over those nine weeks because you said it's 63 days, which is approximately 9 weeks. Can I try maybe one centre for 2 weeks, another for another 2 weeks to see what I'm ultimately going to choose permanently?
Paul
That's fine.
Patty
OK.
Paul
Yes you can and sometimes if you've got a carer looking after you or carers looking after somebody, they may have a medical issue themselves, or they need a break or they need to attend a wedding. So it's a good time to try different places at that time for a week at a time. And it makes that transition a lot easier if somebody's comfortable in the environment they're going into. Because they've been there before.
Patty
While touring, what do you need to look for in a care home?
Paul
So, we assume when I'm doing tours with families, I'm assuming the care levels are sort of similar and you'll never find that out until you find that out. But when touring, you want to have a look around and see if it's friendly. Are people happy? Both staff and residents?
Trust your instinct. If people look unhappy, it's probably because they are unhappy, so that may not be the best place. Is it busy? Is it clean? Are other things happening? What are the lifestyle programs like?
Patty
Are they the good questions to ask?
Paul
Yeah, yeah. What do people get up to? What do they do on a day-by-day basis?
Patty
And that way you can start to make judgments on whether it's the right place, so you'd ask for things like what kind of services do you have? Do you have outings? Do you have barbecues? Do you have cinema visits, streaming services, brain training to keep the mind active?
Paul
Exactly. So, all of those supports that are in place. Most facilities will have some sort of level of that. You just want to find out what's the right type of facility.
Patty
What happens when we think we've chosen the right place. What next?
Paul
So, the first thing to ask is if they have vacancies. If you're like 2 places, usually the preference is to one that actually has a vacancy right now, particularly if you've got some urgency. The paperwork needs to be completed, so you got 2 lots of paperwork, one for the home itself, and the other lot of paperwork for the government.
Patty
That's understandable. And this is important to note. The paperwork takes a long time to complete, so don't think that you'll be done in your lunch break, you will not. And it's an emotional decision as well.
Paul
There's a lot of work. Yeah, there's a lot of work and then the hospital transfer itself, if it's coming from a hospital, they'll arrange all that. So, there's no need to worry about that.
Patty
The other transfer is easy, but the paperwork is not. Are you allowed to bring things from home?
Paul
Yeah. And one of the recommendations I make with families is, is before somebody transitions into care that you actually bring some photos.
Bring a bedside locker or bedside table, some blankets and clothes just so they can see familiar things when they come in. You're usually not allowed to bring a bed or a chair because they're clinical requirements in the home, but photos and blankets and clothes are great.
Patty
Another loaded question, should I visit lots or not? I mean, how do I deal with changing from providing care to letting others do it? Because people underestimate that your loved one needs to see you regularly. A sudden decline in seeing you could impact their mental health, but also yours.
Paul
Yeah, this is really hard. There's an acceptance there that nobody's going to provide the level of care that you may provide to your loved one.
Patty
True.
Paul
Just because they're not doing it 24/7 but staying at the residential care facility all day, every day is also not really sustainable for you or the person in care. They're missing out on that social framework that they may be getting without you there.
Sure, but it's really hard. I mean, I do say to people just to start backing off slowly, but you know you can't force that onto anybody. If they feel comfortable sitting there beside somebody all the time, then that's what they need to do.
Patty
It's such a unique perspective, isn't it? What's gonna work for one person won't work for another.
Paul
That's right.
Patty
How do you wean yourself off? I mean, I imagine that this would be a very unusual judgement call for every individual.
Paul
Yeah, it's normally the first few weeks you're there all the time, but then after that, I tend to suggest not going for a day or not going for a holiday but going for lunch.
But it sometimes takes months for that person. It's not generally the person in care that's making those decisions. It's the person going to see them, actually they can't wean themselves off.
Yeah, and. And you know, in some cases, a lot of the care people that I've dealt with have said that you're actually grieving for that person you might live with that person for 50 or 60 years. So, it's really hard to be quantifiable around how you wean yourself off. You just got to do it.
As best you can, especially when they're having days that are very up and down and you know you've seen them and the last time you saw them, they were very unsettled. Of course. You gonna see them again the next day? Absolutely.
Patty
Quick question, Paul. If things have declined and you want to take your person out and the care facility doesn't necessarily want to discharge them on the day that you want them to be, how do you advocate for your loved one?
Paul
Yeah. Discuss it with the home. If you're unhappy with what's going on, discuss it with the home. You can always move people to another home. Look for alternatives. And again, if you've done some prework around some of this. You will know other homes in the area that you are quite happy with and start reaching out to those.
You can always move people on if you're really unhappy, you're just going to be aware that when you're starting to move people around, one of the things that people, particularly with mental issues, is that they prefer stability and consistency, so when you're topping and changing a lot it becomes a problem for those.
So, you'd only do it as a resort when you're actually unhappy. But if you are unhappy, move, move people along.
Patty
Yeah, that's a really good point. Now. It took us a while to get here, but we are at Step 2. The paperwork. Let's unpack this. Let's do it. Almost like a Rapid Fire Paperwork Session. Let's start with Services Australia pension updates.
Paul
Yeah. So, if you're on a pension or even if you aren't on a pension, you need to fill in some paperwork for the Service Australian people to work out if you should be contributing more towards your care.
If you've been in touch with them all the way along and they have all your information, you can generally just tell them what's going on and they'll work all that out for you. But if you don't know if mum's been in touch with them, for example, or you know they haven't been, then there's some paperwork to fill out. Or you can hop online and get it up.
Patty
So is that the means tested care form? Tell me about that.
Paul
That's right. So, it's a it's about a 20 odd page form and it's you telling the Service Australia people what your financial situation. Looks like and what they'll do then is they'll work out whether you should be contributing more towards your cost of care based on your means.
Patty
When does this need to be completed?
Paul
As soon as possible, go into care, usually within sort of 4-6 weeks.
Patty
What if you're in temporary care?
Paul
If you're in respite, for example, you don't need to do any of this.
Patty
So, the means tested care fee form only needs to be completed if you've gone into permanent care. Who can update all these details?
Speaker 2
That's right. So, the person themselves, if they have capacity, they can update it, whether it's directly with Centrelink or Services Australia or they can nominate someone to go into the office for them, but even if it's a power of attorney, the assumption people make sometimes, as those people have authority, you have to actually complete a form with Services Australia to be able to speak to them.
Patty
That's true. So only if you've been nominated do you have the authority to act on behalf of your loved one. Is it a one off? When we go into care or do we need to update services Australia in an ongoing way?
Paul
Yeah. So, it is a one off. When you go into care initially, but the way it's all worked out is the pension payments and also the means tested care fee from work on your assets and your means.
So, if you are funding some care costs and your assets are decreasing overtime, it's best to update them, because that way you'll get more pension if you're on a pension and you're means tested carefully will come down.
Patty
Can you give me an example when my assets might decline?
Paul
Yep. So if your assets drop by say $10,000 over a period of time, that would be an extra $750 a year. In pension payments, if you're not on a full pension.
Patty
I see and give me some examples of what an asset is and what why it would decline
Paul
So, if you have money in the bank, so let's say you have a bit of money in the bank and now you're funding costs of care and your money in the bank drops by $10,000 over a year or 6 months. Then you are entitled to extra money in your pension and less means tested care fees.
Patty
Question. Is it different for couples versus singles?
Paul
Yep. So, if you're a single person, you'll be on what they call the full-time single pension couples' pension is less per person because there's assumption of shared expenses.
But it's important as well when you let Services Australia know that somebody's gone into permanent care both of you then get assessed as single people as they're separated. Single people. Yeah.
Patty
So, this happens when someone goes into care. Your status as a couple changes and you become what's known as an ‘illness separated couple’, which means they both go on a single person's pension.
Paul
That's right. And the difference is significant. So single pension full pension is at the moment it's around $28,000 a year, but a couple's pension is around 43K, not 56K, not double the single pension.
Patty
Not double the 28. OK, so that means you must tell Centrelink when someone goes into care so that you don't miss out on the money. Does it get backdated?
Paul
Nope
Patty
So, let's segue into some financial decisions. Perhaps you can run through some case studies here, because I feel like it's important to highlight that there are ramifications that will be attached to each decision that you make. First, who makes or can make the financial decisions?
Paul
Yes. So, people who have capacity in themselves and if they if they don't have capacity, Powers of Attorney normally kick in, then you have different types of powers of attorney.
Sometimes you might have a couple of siblings who are powers of attorneys. Sometimes they must agree, sometimes one only can make a decision. Sometimes you'll have a medical power of attorney and a financial power of attorney, there's lots of different ways.
Patty
I had no idea that existed.
Paul
Yeah, there's lots of different ways to stretch all of that. And again, when you're getting everything set up, preplanning, getting all the legal advice on what's best for the family is important.
Patty
So, you might have one sibling that's the financial power of attorney and the other sibling that's the medical power of attorney. Yep. And then you might have it stipulated that they must agree on decisions.
Paul
Or not. That's right. That's right. You can make all those decisions in advance.
Patty
OK. That's really important to know. When should we make a financial decision?
Paul
I mean when I get families phoning me and starting this journey, they initially always ask about the financial decisions. I start by saying to them first, find the right place, get everybody settled down and then we can start working on the financial decisions.
Patty
OK, this is an important point. I feel that a lot of people get really stressed about the finances. When there's so much other work that's important that hasn't been done.
Paul
That’s right.
Patty
So, it's good that you're really, really highlighting this.
Paul
That's right.
Patty
So, if someone lives in a house worth say, I don't know 500K. And a room is worth $2,000,000. That's not necessarily going to be a very good financial decision.
Paul
Yeah, you just need to look, I think when I'm advising families normally within reason, I'm telling them to look for places in the area, cause generally speaking the room costs and the house prices in the area are like for like.
So, whilst you don't make financial decisions before you find the right place. In my experience, looking for a place worth $2,000,000 when you've got a $500,000 house, is just not sensible.
Patty
Tell me what if I cannot pay for a room because maybe I don't want to cash in some assets? How does that work?
Paul
So, the way the the the system works is that you'll have a room cost if you are paying for a room and you can.
Patty
So that's the daily amount?
Paul
Well you can either pay lump sum as a room for a room cost and if you don't want to do that because you don't have the cash available, you can pay a daily amount. So, what the what happens is the facility works out a calculation where they'll tell you what the daily amount. And then you can pay that amount on a daily basis rather than paying a lump sum. You have options.
Patty
Right. So you've always got that option. So the the pressure to pay a lump sum that people feel they need to succumb to is actually not true.
Paul
Not true. There is an interest rate on on that daily amount. So basically it's an interest calculation and some people don't want to be paying interest if they have money in the bank and some people are OK paying a daily amount. Cause they don't pay a lump sum. There's a lot of variety.
Patty
Pros and cons. OK, that makes sense. So I've seen people panic and think that they need to sell their house when it actually might work out better financially. If you just pay the additional daily fee.
Paul
That's right. That's right. So again, it's one of those things. There's lots of decisions to be made. My advice every time, if you've got more than a few dollars in the bank, and you'll hear a lot of people saying we just have a house and a pension.
But in Sydney, for example, a house could be $2,000,000. So, you have assets. So, my advice is, anytime you have some assets, get some accredited advice, so Aged Care Accredited Financial Advisors are out there.
Not somebody who's down the pub. Who did it 2 years ago and knows all the stories. Get some proper advice.
Patty
So, Bob down the pub, who put his parents into care, but he might have very different financial circumstances to you, is not the best person.
Paul
Exactly.
Patty
What are other things that are considered assets, Paul?
Paul
So, you've got superannuation funds these days, pension funds, money in the bank, investment properties or property full stop. You've got things like cars, holiday units, anything that you own is an asset.
Patty
On a scale of 1 to 10, should we get financial advice?
Paul
Yeah, 20. 20 is my advice. is always get some advice, and even if you sit down with somebody for 20 minutes or half an hour, a good financial advisor in this space will tell you if you don't need advice.
If there's only really one option, there's nothing they can do to help you. They should be telling you that, and not taking you through the journey with them because they don't need to.
Patty
Yes, good to know. Yeah. And actually, you don't need to go through that. You're going through so much already.
Paul
No, there's so much to work out and again, it's relying on somebody else telling you their story when they did this a few years ago. I compare it in this space to somebody who's got a heart problem and you meet somebody else who also has a heart problem. You wouldn't automatically jump on their medication just because they told you they've got the same heart problem. You'd go into your professional and get some advice.
Patty
Love that analogy. Can you talk to me about what it means when someone is considered concessional and when they're not?
Patty
Yeah. So, it comes down to that financial assessment of somebody. A concessional person is somebody who has assets less than around $60 000. Now you may have a home and therefore you think you have assets more than that.
But if somebody's staying in the home, that's a dependent, so, a spouse, or some sort of other dependent, the home is excluded from all the assessments. So therefore, you might be a concessional person. What that means is you don't have to actually pay a room cost, you just pay the daily fees for their aged care support.
Patty
OK. So let me let me see if I've got this right. Concessional you're completely government funded. So, for example, Mum and Dad own their own house and have a bit of money in the bank, and Mum needs to go into care. She is considered concessional if Dad remains in the house.
Paul
And the money in the bank is less than that $60,000 per person, yeah.
Patty
And the money in the bank is less than 60 grand. But, tell me if Dad passes away in this example, does her concessional status change?
Paul
Generally speaking, no. And again, it's a case-by-case basis, if she went in as a concessional person, she would stay that potentially, but the cost of care will change significantly because now she owns this house.
Patty
So now this house is considered an asset because Dad is no longer living there.
Paul
That's right. And there's some specific things around the home that are used for assessing means or assessing assets and again, regardless of whether they own a hound and considering themselves concessional and getting some proper advice is always worthwhile.
Patty
Why will her cost of care change? I mean, what's changed in terms of her status or entitlement?
Paul
So, whereas the house was exempt from the assessment before, now it's not, now, it's included.
Patty
And it might impact her pension because it's means an asset tested, right?
Paul
Yeah. So, one of the biggest issues we see in this space is people have automatically sold the house because mum’s going into care, and she lives on her own and she's going into care. They sell the house, and they pay off the room rate, but they can lose their pension because if you sell a million dollar house and pay a $500,000 room rate, you now have $500,000 in the bank, so you don't qualify for a pension anymore.
So again, making those financial knee jerk decisions, if you like, without an advisor to explain, you may decide that that's the best option anyway, but it's best to get all the financial information before you make the decisions.
Patty
So, this means that her pension could decrease and her monthly fee could increase at her living centre?
Paul
Absolutely. Yep.
Patty
And then would there be any other examples that are relevant here?
Paul
So, for example, I've seen cases where mum's going to care, but the the daughter has looked after mum for however many years and in her will she has the house going to the daughter and all the other assets getting split among all the other siblings.
But, if you sell the house, the daughter doesn't get it. So, there's always, I call them tentacles or threads attached to any of these decisions. Things that you pull that make the decision on one level, could tend to call into something else that you don't understand.
Patty
This is a good place for us to end before we tag your interview, with its financial cousin. Let's ask some very interesting personal questions, just to finish now, how do you feel about that?
Paul
OK, OK. Yep.
Patty
Alright. Do you snore?
Paul
No.
Patty
How do you know?
Paul
I've never heard myself snoring.
Patty
OK, alright, I'll let you off with that one. If you could travel back in time, what period would you travel to?
Paul
Either ancient Rome or the 70s for music.
Patty
Ohh, do you speak or understand Gaelic?
Paul
I just had to go to the toilet because it got beat into me as a kid at school.
Patty
What's your favourite carb? Is it bread, pasta, rice or potatoes?
Paul
You would think I would say potatoes, given my Irish background but bread, especially fresh cooked bread.
Patty
With butter?
Paul
Lots of butter.
Patty
And what kind of Australian are you now? Do you add the Vegemite?
Paul
Yes, yes, I do. I really like Vegemite and Vegemite and peanut butter together is fantastic.
Patty
Go you! If you could push a button and make everyone in the world 7% happier, but it would also place a worldwide ban on all their hair styling products, would you push it?
Paul
Yeah, no problem. I have no hair, so that's no issue to me at all. Sorry, that's easy.
Patty
Thank you so much for being with us here today.
Paul
It's a pleasure.
Patty
That is all we have time for today folks. If you think this would be a powerful interview to share with someone who could benefit from Paul’s wisdom, please feel free to share it with them.
We will be following this interview up with another episode that will help to explain the financial choices you have when choosing residential care options.
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Billy:
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